Key Points:
Gold prices remained stable during early Asian trading hours on Wednesday, with spot gold trading at $2,660.36 per ounce by 0036 GMT.
Market participants are waiting for key U.S. economic data, including retail sales figures and industrial production, to assess the Federal Reserve’s next move on interest rates.
With a 97.2% probability of a 25-basis-point cut priced in for November, lower rates could bolster gold’s appeal as a non-yielding asset.
Picture: Gold consolidates near 2663.64, with bullish momentum building as traders monitor geopolitical risks and Federal Reserve signals, as seen on the VT Markets app.
The key takeaway we can see here is gold’s consolidation around 2663.64, with the MACD showing improving momentum, indicating potential upside.
A break above 2668.91 could unlock further gains toward 2675, while 2650.75 serves as critical support to watch.
We see the price fluctuating between a low of 2658.70 and a high of 2665.16, indicating a period of consolidation with slight bullish momentum.
Additionally, the US dollar’s recent volatility and mixed inflation data have kept investors leaning toward gold as a hedge against uncertainty.
Market participants are also watching upcoming Federal Reserve meetings, where further hints regarding the future path of interest rates could influence gold prices.
Traders are paying close attention to the U.S. retail sales report due Thursday, which could shape expectations for Fed policy, along with industrial production figures and weekly jobless claims.
See also: Gold Dips as Dollar Rises; All Eyes on Fed Cues
With Fed officials such as San Francisco President Mary Daly reiterating the likelihood of additional rate cuts, the market remains confident about further easing if economic data aligns with expectations.
Atlanta Fed President Raphael Bostic, however, suggested just one more 25-bps reduction for the rest of the year.
A reduction in interest rates makes non-yielding assets like gold more attractive. If the data meets or exceeds expectations, it could confirm a Fed cut and potentially lift bullion prices further.
Meanwhile, the recent Israel-Hamas conflict has also been on traders’ radar.
Israeli Prime Minister Benjamin Netanyahu informed French President Emmanuel Macron that Israel would reject any ceasefire that allows Hezbollah to regroup.
With ongoing tensions in the region, gold’s status as a safe-haven asset remains intact, which could support prices if the conflict escalates.
Delegates at the London Bullion Market Association (LBMA) conference in Miami forecast that gold prices could rise to $2,941 per ounce within the next 12 months, reflecting a generally bullish sentiment for precious metals.
As markets await more clarity on the U.S. economy, currency trends, and geopolitical developments, these metals remain sensitive to shifts in both economic and geopolitical risk factors.
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