XAUUSD steadied on Friday, trading at $2,710.20, just below Thursday’s one-month high of $2,724.73. The pair has gained 1% this week, extending its rally for a third straight week. Expectations of Federal Reserve rate cuts supported the uptrend, bolstered by softer inflation data and dovish remarks from policymakers.
Richmond Fed President Thomas Barkin highlighted easing price pressures in December, while Fed Governor Christopher Waller indicated the potential for three to four rate cuts this year if economic conditions weaken further.
Easing Treasury yields and a weaker U.S. dollar provided additional support for XAUUSD. Despite a 0.43% drop in SPDR Gold Trust holdings to 868.78 tonnes, the pair retained its momentum, underscoring its appeal as a hedge against inflation in a shifting monetary environment.
Picture: XAUUSD climbs to 2710.20 with bullish momentum slowing after reaching a high of 2724.73 as seen on the VT Markets app.
Looking at the 15-minute chart, XAUUSD shows an upward trajectory, closing at 2710.20 with a trend gain of 0.57%. The price surged from a low of 2676.70 to a high of 2724.73, breaking through key levels before consolidating near the 2710 zone.
The moving averages (5, 10, and 30-period) exhibit a bullish alignment, with the short-term MA leading the way higher. However, the MACD histogram reveals diminishing bullish momentum as green bars contract and the MACD line flattens near the signal line, indicating potential consolidation or a retracement in the near term. This setup highlights a cautious market with strong gains but waning momentum.
XAUUSD’s trajectory will hinge on upcoming U.S. retail sales and industrial production data, which could influence the Fed’s policy outlook. Uncertainties surrounding President-elect Donald Trump’s controversial tariff policies, also pose potential risks and opportunities for the pair’s movement.
With XAUUSD firmly positioned near its highs, traders will closely monitor the $2,725 resistance level for signs of a breakout or further consolidation.
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