Gold Price Forecast: XAU/USD bulls clean up within daily range
- Gold price rallies into shorts and closes up high.
- Market bets against a Fed hike and US Dollar is under pressure.
The Gold price rallied to a high of $1,970.54 from a low of $1,940.10 on Thursday as the US Dollar and lower bond yields weakened with the United States reporting the largest rise in initial jobless applications since the autumn of 2021. At the time of writing, the Gold price is stationary towards the close of the US forex session at $1,966.
The slump in the US Dollar index, DXY, hit a 2-week low as the Federal Reserve is now expected to leave interest rates unchanged when its policy committee meets next week. The CME Fedwatch tool is seeing only a 25% probability that the central bank will raise rates again.
Initial Jobless Claims last week rose by 261,000, more than expectations for a rise of 236,000 and this sent the yield on the 10-year note to a low of 3.708% and the US two-year note down to 4.475%.
Gold prices continue to toe the line near the psychologically important $1,960/oz range, analysts at TD Securities noted. ''While these liquidations may have dampened the implications of a surprise hike from the Fed this June, gold bugs are not out of the woods just yet.''
Gold technical analysis
From a 4HR perspective, a bullish bias could be drawn with the price targetting the highs.
The H1 chart shows the price coiled in a triangle which could lead to a breakout to the upside to target above the equal highs. However, a break below the support of $1,961 opens the risk of a bearish correction.