Gold Technical Analysis – We got a new all-time high. Now what?

Fundamental Overview

Gold extended the rally triggered by the soft US CPI into a new all-time high following the soft US PPI data on Thursday. The components that feed into the US Core PCE though increased the estimates for the next release.

In the bigger picture though, as long as the Fed doesn’t change its reaction function and doesn’t mention rate hikes, the trend should remain to the upside as real yields will continue to fall unless we get another strong growth scare.

The attention now switches to the FOMC Policy Decision due on Wednesday when the Fed is expected to keep rates unchanged. The markets will focus particularly on the Dot Plot to see if the central bank revises the expected rate cuts in 2025 from two to three.

Gold Technical Analysis – Daily Timeframe

On the daily chart, we can see that gold managed to extend the rally into a new all-time high following the soft US PPI report. From a risk management perspective, the buyers will have a better risk to reward setup around the 2955 level to position for further upside, while the sellers will want to see the price falling below the level to start targeting a pullback into the 2832 level next.

Gold Technical Analysis – 4 hour Timeframe

On the 4 hour chart, we can see more clearly the key levels where the buyers can lean onto for further upside. The first one comes around the previous all-time high at 2955, while the second one around the trendline. The sellers, on the other hand, will look for the price to break below those levels to pile in for new lows.

Gold Technical Analysis – 1 hour Timeframe

On the 1 hour chart, we can see that the recent price action formed what looks like a head and shoulders pattern. The buyers will step in around the neckline with a defined risk below it to keep pushing into new highs, while the sellers will look for a break lower to target a pullback into the 2955 level next. The red lines define the average daily range for today

Upcoming Catalysts

Today we get the US Retail Sales data. On Wednesday, we have the FOMC Policy Decision. On Thursday, we get the US Jobless Claims figures.

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