At the time of reporting, the price of gold is showing signs of resilience, trading at $2,319, albeit struggling to recover from recent sell-offs.
The persistent strength of the US dollar continues to exert downward pressure on the precious metal. Additionally, the release of Australian CPI data revealing a higher-than-expected growth of 1.0% q/q and 3.5% y/y adds to the headwinds faced by gold.
Gold appears to be in a corrective phase, with potential for further extension. Despite Canadian Retail Sales reporting a 0.1% decline compared to an anticipated growth of 0.1%, and Core Retail Sales registering a 0.3% drop against an expected flat growth, market expectations were not met.
Yesterday’s US Durable Goods Orders surpassed expectations, although Core Durable Goods Orders slightly disappointed. Today, the release of key US economic data is anticipated to have a significant impact. Projections suggest a 2.5% growth in Advance GDP following the 3.4% growth in the previous period. Unemployment Claims may see a slight increase from 212K to 214K, while Pending Home Sales could report a 0.3% growth.
Additionally, attention will be on the Advance GDP Price Index, Goods Trade Balance, and Preliminary Wholesale Inventories figures upon their release.
In technical analysis, the gold price experienced a short-term decline to $2,291, where demand emerged. Currently, the price is consolidating between this new low and the $2,334 level. Although the metal failed to reach the median line of the descending pitchfork and the weekly S2 at $2,284, indicating potential exhaustion among sellers, a bearish bias persists as long as it remains within the descending pitchfork’s range.
Potential false breakouts above resistance levels could signal renewed selling pressure. Only a breakout above the upper median line and the establishment of a new higher high would suggest a shift towards upward momentum.
