Gold Pulls Away From Daily Highs, Holds Near $2,650
Gold price near $2,650 remains a focal point for traders as the precious metal seeks direction amidst a mix of technical and fundamental drivers. After retreating from daily highs, buyers are cautiously stepping back, supported by the 14-day Relative Strength Index (RSI), which briefly reclaimed the 50 level. However, the ongoing Bear Cross pattern suggests that bullish momentum might not sustain unless key resistance levels are breached.
Technical Analysis: Key Levels for Gold Price
The gold price near $2,650 faces stiff resistance at the 50-day Simple Moving Average (SMA) of $2,670. A daily close above this level could pave the way for an advance toward $2,700 and potentially test the November 25 high of $2,721.
On the downside, if buyers fail to hold ground above $2,650, the next support lies at the previous day’s low of $2,621, followed by the weekly low at $2,605. Further declines could push Gold toward the 100-day SMA at $2,573, a critical level to monitor for sellers aiming to extend the downward trajectory.
Fundamental Factors Influencing Gold Price
The gold price near $2,650 finds support from a dovish Federal Reserve sentiment. Market participants are betting on a 25 basis points rate cut in December, with the CME Group’s FedWatch Tool now showing a 63% probability of this outcome, up from 55% a week ago. The softer US Dollar, weakened by these rate cut expectations, continues to underpin the appeal of the non-interest-bearing Gold.
Additionally, geopolitical tensions bolster Gold’s traditional safe-haven status. Renewed conflict between Russia and Ukraine, with reports of potential escalations from Russian President Vladimir Putin, has heightened market uncertainty. These tensions, coupled with retaliatory strikes and ongoing international scrutiny, add a layer of bullish sentiment for Gold.
Broader Market Dynamics and Catalysts
Global economic concerns also play a role in shaping the gold xauusd price near $2,650. US President-elect Donald Trump’s tariff announcements earlier in the week have reignited fears of a global trade war, though the US Dollar continues to weaken against its major counterparts.
Meanwhile, thin trading conditions due to the Thanksgiving holiday in the US may limit immediate volatility. Traders will keep an eye on the Eurozone inflation report and broader end-of-week market flows for potential shifts in sentiment.
Impact of Japanese Yen Strength
The Japanese Yen’s sharp rebound, driven by higher-than-expected Tokyo inflation data, has fueled expectations of a Bank of Japan (BoJ) rate hike. This movement has influenced the USD/JPY pair, indirectly supporting Gold by adding pressure on the US Dollar.
Outlook for Gold Price
As the gold price near $2,650 navigates these complex market dynamics, its next move will depend on whether key technical levels are breached and fresh catalysts emerge. Traders should monitor geopolitical developments, US Dollar performance, and economic data releases for insights into Gold’s direction.
Whether Gold sustains its recovery or retreats to test lower support levels, the coming days will be pivotal for its trajectory.
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