Daily Analysis For GOLD (XAU/USD) 13-06-2023

Daily Analysis For GOLD (XAU/USD) 13-06-2023

Gold (XAU/USD) Analysis


Key Points: -


·       Gold price has successfully moved above the $1,960.00 level in anticipation of the upcoming US inflation data.


·       The energy component is expected to exert considerable pressure on US inflation, which could have implications for the gold market.


·       There is a potential clash between the US Consumer Price Index (CPI) data and the volatile contraction pattern observed in the gold price, creating the possibility of a significant market reaction or "explosion."


Today's Scenario: -


Gold price (XAU/USD) has surpassed the key resistance level of $1,960.00 as market participants await the release of the United States Consumer Price Index (CPI) data, scheduled for 12:30 GMT. Investors are closely monitoring the US inflation figures to gain insights into the Federal Reserve's (Fed) interest rate policy, which is expected to lead to volatile movements in the precious metal.


S&P500 futures are holding onto gains achieved during the Asian session, as the likelihood of a neutral interest rate decision by the Fed remains strong. Market sentiment is positive, and risk-sensitive assets are attracting greater appeal.


The US Dollar Index (DXY) is vulnerable, hovering near a two-week low of around 103.20, as market participants anticipate significant pressure on US inflation from the energy component.


According to analysts at NBF, the energy component is expected to negatively impact the headline index, with prices likely to have declined in both the gasoline and natural gas segments. However, expected gains for shelter could still contribute to a 0.2% monthly increase in headline prices. If these expectations are accurate, the annual rate should decline from 4.9% to a two-year low of 4.1%. Meanwhile, the core index is projected to have advanced 0.3% on a monthly basis, resulting in a 5.1% annual gain.


The increased probability of a neutral Fed policy is reflected in lower US Treasury yields. The yield on 10-year US Treasury bonds has dropped to around 3.72%.


Diagram of XAU/USD (Gold): -

Economic Events: -


Date    Event                                                                                                                Impact    Currency

4:15     (New Zealand) Visitor Arrivals YoY                                                        Low      NZD

5:20     (Japan) BSI Large Manufacturing QoQ                                                Low      JPY

6:00     (Australia) Westpac Consumer Confidence Change                       High     AUD

6:00     (Australia) Westpac Consumer Confidence Index                           High     AUD

7:00     (Australia) NAB Business Confidence                                                 High     AUD

11:30   (Germany) Harmonised Inflation Rate MoM                                        Low      EUR

11:30   (Germany) Harmonised Inflation Rate YoY                                           Low      EUR

11:30   (Germany) Inflation Rate MoM                                                         Medium      EUR

11:30   (Germany) Inflation Rate YoY                                                            Medium      EUR

11:30   (Germany) CPI                                                                                             High      EUR

11:30   (United Kingdom) Average Earnings excl. Bonus (3Mo/Yr)              Low      GBP

11:30   (United Kingdom) Average Earnings incl. Bonus (3Mo/Yr)       Medium      GBP

11:30   (United Kingdom) Unemployment Rate                                               High      GBP

11:30   (United Kingdom) Claimant Count Change                                         High      GBP

11:30   (United Kingdom) Employment Change                                               High      GBP

11:30   (United Kingdom) HMRC Payrolls Change                                           Low      GBP

12:30   (Lithuania) Current Account                                                                    Low      EUR

12:30   (Spain) CPI                                                                                                  High      EUR

12:30   (Spain) Core Inflation Rate YoY                                                              Low       EUR

12:30   (Spain) Harmonised Inflation Rate MoM                                             Low       EUR

12:30   (Spain) Harmonised Inflation Rate YoY                                                Low       EUR

12:30   (Spain) Inflation Rate MoM                                                                     Low       EUR

12:30   (Spain) Inflation Rate YoY                                                                        Low       EUR

13:30   (China) Total Social Financing                                                               Low       CNY

13:30   (China) New Yuan Loans                                                                          Low       CNY

13:30   (China) M2 Money Supply YoY                                                               Low       CNY

13:30   (China) Outstanding Loan Growth YoY                                                Low       CNY

14:10   (Spain) 3-Month Letras Auction                                                             Low       EUR

14:30   (Euro Area) ZEW Economic Sentiment Index                            Medium        EUR

14:30   (Germany) ZEW Economic Sentiment Index                                    High        EUR

14:30   (Germany) ZEW Current Conditions                                                    Low        EUR

14:30   (United Kingdom) 10-Year Treasury Gilt Auction                             Low        GBP

14:40   (Italy) 3-Year BTP Auction                                                                     Low         EUR

14:40   (Italy) 7-Year BTP Auction                                                                     Low         EUR

14:40   (Italy) 30-Year BTP Auction                                                                  Low         EUR

15:00   (Germany) 5-Year Bobl Auction                                                          Low          EUR

15:15   (Euro Area) ECB Enria Speech                                                            Low          EUR

15:30   (Latvia) Current Account                                                                      Low         EUR

15:30   (United States) NFIB Business Optimism Index                            Low          USD

17:30   (Ecuador) Balance of Trade                                                                 Low          USD

18:00   (United States) Core Inflation Rate MoM                                 Medium          USD

18:00   (United States) Inflation Rate MoM                                                 High          USD

18:00   (United States) Core Inflation Rate YoY                                          High          USD

18:00   (United States) Inflation Rate YoY                                                    High          USD

18:00   (United States) CPI                                                                               High          USD

18:00   (United States) CPI s.a                                                                        High          USD

18:15   (Germany) Current Account                                                                Low          EUR

18:25   (United States) Redbook YoY                                                             Low          USD

19:30   (United Kingdom) BoE Gov Bailey Speech                              Medium         GBP

20:30   (United Kingdom) BoE Dhingra Speech                                         Low          GBP

21:00   (United States) 52-Week Bill Auction                                              Low          USD

22:30   (United States) 30-Year Bond Auction                                            Low          USD



Buy Scenario: -


On the upside, if there is a breakout above the previously mentioned EMA confluence at around $1,965-70, the Gold Price needs to surpass a one-month-old resistance line, currently near $1,982, to limit the short-term upside potential.


Subsequently, a rise towards the psychological level of $2,000, followed by the resistance near $2,050 that has been in place for the past two months, cannot be ruled out.


Overall, the Gold Price remains under pressure, but the potential for further downside appears limited. Till we did not advise to buy XAU/USD.


Selling Scenario: -


The Gold Price (XAU/USD) has experienced a decline after reversing from a convergence of the 21-Exponential Moving Average (EMA) and the 50-EMA, putting an end to its two-week winning streak.


The reversal from the key EMA confluence has given sellers hope, but the Relative Strength Index (RSI) line, which is below the 50.0 level at 14, indicates limited downside potential for the commodity. This highlights the significance of the 100-EMA support level around $1,937 as a crucial level for bearish momentum in Gold.


If the XAU/USD bears manage to break below the $1,937 support level, although it is less likely, there is a possibility of a gradual decline towards the support zone of $1,890-85. This zone encompasses multiple levels that have been established since early February, including the 200-EMA. We do not advise selling XAU/USD.


Support and Resistance Level: -

 Support              Resistance  

 S1 1949.06   -     R1 1966.85

 S2 1940.27  -      R2 1975.85

 S3 1931.27  -      R3 1984.64


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