(MENAFN- Daily Forex)
The gains of the US dollar paused ahead of the announcement of the minutes of the latest federal Reserve meeting later today, alongside increased global geopolitical tensions, all factors that aided bulls in pushing the price of Gold higher, with gains reaching the resistance level of $2032 per ounce. Shortly, the reaction from the American event today will determine the fate of further gold gains or the opposite.
Recently, gold prices showed flexibility in performance and maintained stability in the face of the rise in the price of the US dollar and the rise in Treasury bond yields. In general, investors remained on alert for insights from the minutes of the US Federal Reserve's latest monetary policy meeting, and eagerly awaited evidence regarding the timing of potential adjustments to US interest rates . In general, these developments have made US dollar-denominated gold less attractive to international investors.
Will the price of gold decrease in the coming days?
In this regard, Matt Simpson, chief analyst at City Index, pointed to weak levels of volatility across markets amid the extended weekend in the United States of America and the scarcity of influential news. Expectations for useful insights from the minutes of the upcoming Federal Open Market Committee (FOMC) meeting have been tempered, given the Fed's outspoken stance and the meeting preceding the latest inflation data releases. Therefore, gold markets may continue to be primarily affected by technical factors in the short term.
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Today, the minutes of the January FOMC meeting will be of potential importance to market sentiment and gold price dynamics. Despite progress in inflation in the United States of America, San Francisco Federal Reserve Bank President Mary Daly emphasized the continued need for price stability, indicating further political considerations. In addition, another Fed official warned of prolonged delays in interest rate adjustments.
Moreover, Data last week revealed that consumer and producer prices in the United States of America rose higher than expected, reducing expectations for a cut in interest rates in March, with market sentiment now leaning towards a 75% possibility of a cut in June, according to the Federal Reserve's monitoring tool. From CME. Usually, low interest rates reduce the opportunity cost of holding non-interest-bearing assets such as gold.
Gold Price Forecast and Analysis Today:
According to the performance on the daily chart above, the price of gold is on an upward rebound path, and the bulls' control over the trend will strengthen over that period of time if it moves towards the resistance levels of 2055 and 2070 dollars per ounce, respectively. On the other hand, over the same period of time, there will be no control for the bears in the direction of the gold price without moving towards the support levels of 2000 and 1985 dollars per ounce, respectively. Finally, we still recommend buying gold from every falling level, as global geopolitical tensions, and the increase in central banks' purchases of gold are factors that support gold's gains in the coming period.
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