Gold Price Bounces Back Ahead of August Low
Gold Price Outlook: XAU/USD
The price of gold bounces back ahead of the monthly low ($3282) to trade back above the 50-Day SMA ($3347), but the precious metal may continue to track the flattening slope in the moving average as it still trades within the June range.
Gold Price Bounces Back Ahead of August Low
The price of gold approaches the monthly high ($3409) as Federal Reserve Chairman Jerome Powell warns that ‘the shifting balance of risks may warrant adjusting our policy stance,’ and the central bank may unwind its restrictive policy over the remainder of the year to keep the US economy near full-employment.
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However, the ongoing transition in US trade policy may lead to a greater dissent within the Federal Open Market Committee (FOMC) as the central bank continues to combat inflation, and the threat of a policy error may boost the appeal of gold as it offers an alternative to fiat currencies.
With that said, the price of gold may reestablish the bullish trend from earlier this year should it break out of the June range, but bullion may continue to track the flattening slope in the 50-Day SMA ($3347) if it struggles to test the monthly high ($3409).
XAU/USD Price Chart – Daily
Chart Prepared by David Song, Senior Strategist; XAU/USD on TradingView
- The price of gold seems to be reversing ahead of the monthly low ($3282) as it extends the advance from last week, with a breach above the monthly high ($3409) bringing the July high ($3439) on the radar.
- Need a breach above the June high ($3451) to open up the April high ($3500), with the next area of interest coming in around $3540 (161.8% Fibonacci extension).
- However, lack of momentum to test the monthly high ($3409) may keep the price of gold within the June range, and failure to hold above $3370 (161.8% Fibonacci extension) may push bullion back toward $3280 (100% Fibonacci extension).
Additional Market Outlooks
GBP/USD Defends Fed Symposium Rally
US Dollar Forecast: USD/JPY Bounces Back Ahead of Monthly Low
Canadian Dollar Forecast: USD/CAD Tumbles as Fed Warns of Rate Cut
EUR/USD Under Pressure After Failing to Test Monthly High
--- Written by David Song, Senior Strategist
Follow on X at @DavidJSong
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