Published on May 23, 2023

Daily Analysis For GOLD (XAU/USD) 23-05-2023

Gold (XAU/USD) Analysis

Economic Events and Scenario for XAU/USD (GOLD)

Economic Events :-

GMT	Event	Impact	Currency
00:00	(Australia) Judo Bank Composite PMI	Low	AUD
00:00	(Australia) Judo Bank Manufacturing PMI	High	AUD
00:00	(Australia) Judo Bank Services PMI	High	AUD
01:00	(Montenegro) Independence Day	None	EUR
01:30	(Japan) Jibun Bank Manufacturing PMI	Medium	JPY
01:30	(Japan) Jibun Bank Services PMI	Medium	JPY
01:30	(Japan) Jibun Bank Composite PMI	Low	JPY
07:00	(Lithuania) Industrial Production MoM	Low	EUR
07:00	(Lithuania) Industrial Production YoY	Low	EUR
07:00	(United Kingdom) Public Sector Net Borrowing	Low	GBP
07:00	(United Kingdom) Public Sector Net Borrowing Ex Banks	Low	GBP
08:00	(Slovakia) Current Account	Low	EUR
08:15	(France) S&P Global Composite PMI	Low	EUR
08:15	(France) S&P Global Manufacturing PMI	Medium	EUR
08:15	(France) S&P Global Services PMI	Medium	EUR
08:15	(Euro Area) ECB Guindos Speech	High	EUR
08:15	(Euro Area) ECB Jochnick Speech	Low	EUR
08:30	(Germany) S&P Global Composite PMI	Low	EUR
08:30	(Germany) S&P Global Services PMI	High	EUR
08:30	(Germany) S&P Global Manufacturing PMI	High	EUR
09:00	(Euro Area) Current Account	Low	EUR
09:00	(Euro Area) S&P Global Composite PMI	Low	EUR
09:00	(Euro Area) S&P Global Services PMI	High	EUR
09:00	(Euro Area) S&P Global Manufacturing PMI	High	EUR
09:00	(Euro Area) Current Account s.a	Low	EUR
09:30	(Slovenia) Consumer Confidence	Low	EUR
09:30	(United Kingdom) S&P Global/CIPS Manufacturing PMI	High	GBP
09:30	(United Kingdom) S&P Global/CIPS UK Services PMI	High	GBP
09:30	(United Kingdom) S&P Global/CIPS Composite PMI	Low	GBP
10:00	(Italy) Current Account	Low	EUR
10:00	(United Kingdom) 28-Year Index-Linked Treasury Gilt Auction	Low	GBP
10:30	(Germany) 2-Year Schatz Auction	Low	EUR
11:00	(Latvia) PPI YoY	Low	EUR
11:00	(Latvia) PPI MoM	Low	EUR
11:25	(Euro Area) ECB Enria Speech	Low	EUR
13:00	(United States) Building Permits	Medium	USD
13:00	(United States) Building Permits MoM	Low	USD
13:30	(Canada) Raw Materials Prices YoY	Low	CAD
13:30	(Canada) Raw Materials Prices MoM	Low	CAD
13:30	(Canada) PPI YoY	Low	CAD
13:30	(Canada) PPI MoM	Low	CAD
13:55	(United States) Redbook YoY	Low	USD
14:00	(United States) Fed Logan Speech	Medium	USD
14:45	(United States) S&P Global Services PMI	High	USD
14:45	(United States) S&P Global Composite PMI	Medium	USD
14:45	(United States) S&P Global Manufacturing PMI	High	USD
15:00	(United States) Richmond Fed Manufacturing Shipments Index	Low	USD
15:00	(United States) New Home Sales MoM	High	USD
15:00	(United States) Richmond Fed Services Index	Low	USD
15:00	(United States) New Home Sales	High	USD
15:00	(United States) Richmond Fed Manufacturing Index	Low	USD
15:30	(Slovenia) Unemployment Rate	Low	EUR
18:00	(United States) 2-Year Note Auction	Low	USD
20:00	(El Salvador) Balance of Trade	Low	USD
21:30	(United States) API Crude Oil Stock Change	Medium	USD
23:45	(New Zealand) Retail Sales YoY	High	NZD
23:45	(New Zealand) Retail Sales QoQ	High	NZD

Today's Scenario: - The price of gold (XAU/USD) continues to decline, reaching an intraday low near $1,961. This marks the second consecutive day of losses, as the precious metal retraces its corrective bounce from Friday. The main factor weighing on gold is the strength of the US Dollar, which has been supported by positive sentiment regarding negotiations to avoid a US default. The US Dollar Index (DXY) has been grinding higher, currently around 103.30, reflecting a two-day uptrend.

Despite the lack of a debt ceiling deal between US President Joe Biden and House Speaker Kevin McCarthy, policymakers remain optimistic about reaching an agreement. President Biden described the meeting with Speaker McCarthy as productive in terms of the need to prevent default, while McCarthy also acknowledged the productive nature of the meeting but indicated that no debt ceiling deal has been reached.

The upcoming release of Purchasing Managers Indexes (PMI) for May from leading economies, including the US, adds to the cautious sentiment surrounding gold. The stronger US Dollar and the anticipation of economic data may influence the direction of gold prices in the short term.

Buy Scenario: - On the upside, if gold manages to break above the immediate resistance-turned-resistance line at around $1,965, it doesn't guarantee a strong rally for buyers. The 100-hour moving average (HMA) resistance near $1,974 and a downward-sloping resistance line from May 11, around $1,977, will present additional hurdles for the XAU/USD upside movement.

Furthermore, a three-week descending resistance line near $1,989 will act as a final defense for the gold bears.

Overall, the gold price is expected to experience further downside, although reaching the $1,900 level may prove to be a challenging and volatile journey. Till we did not advise to buy XAU/USD.

Selling Scenario: - The price of gold (XAU/USD) is facing downward pressure as it breaks below a three-day ascending support line, which now serves as immediate resistance around $1,965. This suggests a continued downside bias for gold. The bearish signals from the Moving Average Convergence Divergence (MACD) indicator further support the bearish outlook. However, it's worth noting that the monthly low around $1,950 may attract some selling pressure, as the Relative Strength Index (RSI) indicates oversold conditions.

If the gold price remains bearish and falls below $1,950, the next target for sellers could be the late March swing low near $1,935. We do not advise selling XAU/USD.

Support and Resistance Level: -