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- Gold price makes another run toward the $2,033 barrier amid an upbeat mood on Friday.
- US Dollar sellers ignore positive US Treasury bond yields and hawkish Fedspeak.
- Gold price remains poised for a firm break above $2,033, as a falling wedge breakout remains in play.
Gold price is replicating the same moves seen in Thursday’s Asian trading, as buyers attempt another run toward the key contention level of $2,033 early Friday. The US Dollar continues to display a subdued momentum, despite the hawkish Fedspeak and positive US Treasury bond yields, as Gold traders await the US Federal Reserve’s (Fed) semi-annual Monetary Policy Report (MPR) due later on Friday.
Gold price eyes more Fedspeak and Fed’s Monetary Policy Report
The Asian stock markets continue to cheer the overnight AI optimism wave seen on the Wall Street indices, in the wake of the encouraging earnings report from the US chipmaker Nvidia.
The safe-haven US Dollar bears the brunt of the risk-on market profile, motivating Gold buyers to regain upside traction. However, the continued downfall in China’s House Price Index combined with mixed global business PMI data and hawkish Fedspeak seem to take the wind out of the ongoing risk rally. S&P Global Manufacturing PMI improved to 51.5 from 50.7 in February, while S&P Global Services PMI edged lower to 51.3 from 52.5.
Further, the US Treasury bond yields staged a modest comeback, as Fed policymakers kept pushing back against expectations of early and aggressive Fed interest rate cuts. Fed Governor Christopher Waller said late Thursday that there is no rush to begin cutting interest rates. Governor Lisa Cook noted that policy rates will change when disinflation looks sustainable. Meanwhile, Fed Vice Chair Phillip Jefferson said that “it will likely be appropriate to begin cutting policy rates later this year.
If the risk-on mood wanes in the upcoming sessions, it could fuel a fresh uptrend in the US Dollar and Gold price could once again run into sellers at higher levels. Therefore, the Gold price action now remains in the hands of the broad market sentiment and the US Dollar dynamics, as traders brace for more Fedspeak and the key Fed’s Monetary Policy Report.
Also, the end-of-the-week flows could remain in play, spiking up volatility around the Gold price later in American trading.
Gold price technical analysis: Daily chart
The short-term technical outlook for Gold price remains more or less the same, as the bright metal remains poised to break higher through the crucial 50-day Simple Moving Average (SMA) hurdle at $2,033 on a weekly closing basis.
The technical setup remains in favor of further upside, especially after the Gold price confirmed a falling wedge breakout above the descending trendline resistance of $2,018 earlier in the week.
Gold buyers will need to find a strong foothold above the 50-day SMA at $2,035 to aim for the February 7 high of $2,044, followed by the $2,050 psychological barrier.
The 14-day Relative Strength Index (RSI) sits just above the midline, backing the bullish potential in Gold price.
On the contrary, if Gold buyers face rejection once again at the 50-day SMA, the 21-day SMA at $2,023 will be back on the sellers’ radars. A failure to defend the latter could fuel a fresh downswing toward $2,004, the confluence of the wedge resistance-turned-support and the upward-pointing 100-day SMA.
Ahead of that, Tuesday’s low of $2,015 could come to the rescue of Gold optimists.
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