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03.07.202413:29 Forex Analysis & Reviews: XAU/USD. Review and analysis

Exchange Rates 03.07.2024 analysis

Hopes that the US Central Bank will begin a cycle of rate cuts at the September meeting were confirmed yesterday by dovish statements from Federal Reserve Chairman Jerome Powell. Additionally, concerns over a slowdown in global economic growth, political uncertainty in the US and Europe, and ongoing geopolitical tensions are supporting the precious metal.

However, the growth potential for gold is still limited, as most investors and traders prefer to wait for additional signals regarding the future policy decisions of the Federal Reserve. Consequently, the main focus will remain on the release of the FOMC meeting minutes, which will be published today during the US session. This publication will influence the short-term dynamics of the US dollar prices, providing a new directional impulse to the non-yielding yellow metal.

Additionally, attention should be paid to the US economic data, including the ISM Services PMI and the ADP employment report in the private sector.

Nevertheless, the aforementioned fundamental backdrop suggests that the path of least resistance for XAU/USD lies to the north, and any significant corrective decline can be seen as a buying opportunity.

From a technical perspective, since the 50-day SMA has already been breached, the precious metal might reclaim the round level of $2400 and aim to surpass the historical high of around $2450, reached in May.

On the other hand, the area of $2315-2318 has become strong support before the round level of $2300 and the horizontal level of $2285. A decisive break below the latter will be considered a new trigger for bears, making the gold price vulnerable to accelerating its decline towards the 100-day SMA, which is currently around $2263. Gold may continue its downward trajectory further, towards $2225-2220, before dropping to the round level of $2200.

Exchange Rates 03.07.2024 analysis

*El análisis de mercado publicado aquí tiene la finalidad de incrementar su conocimiento, más no darle instrucciones para realizar una operación.

Irina Yanina,
Analytical expert of InstaSpot
© 2007-2024
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