Market Analysis

Bullish bias persists as the gold price struggles to capitalize on slight increases in a positive risk environment

Amos Simanungkalit · 15 Aug151.9K Views

Gold prices (XAU/USD) experienced losses on Wednesday as investor expectations for more aggressive policy easing by the Federal Reserve (Fed) diminished following the release of US consumer inflation data. However, ongoing geopolitical risks from the Middle East conflicts and increasing anticipation of an imminent Fed rate-cutting cycle helped the metal regain positive momentum on Thursday.

In the meantime, the reduced likelihood of a 50 basis point (bps) Fed rate cut in September contributed to a modest recovery in US Treasury bond yields. This development, coupled with the US Dollar (USD) rebounding from its near-monthly low after the US CPI report, limited further gains for the non-yielding yellow metal, especially amid a generally upbeat sentiment in equity markets ahead of key US macroeconomic releases scheduled for later on Thursday.

Technical Outlook: Gold prices appear positioned for further gains, with the $2,430-2,425 support zone critical for the bulls.

From a technical standpoint, the recent swing low around the $2,438 level now seems to provide immediate downside protection, followed by the $2,424 area, which marked the weekly low on Monday. Should selling pressure persist, Gold prices could weaken further, dipping below the $2,400 mark and testing the 50-day Simple Moving Average (SMA), currently near the $2,380 zone. A decisive break below this level may expose the 100-day SMA, around the $2,360 region, potentially triggering deeper losses for bearish traders.

Meanwhile, daily chart oscillators remain in positive territory, supporting the likelihood of additional near-term gains. However, any further upward movement is likely to face resistance near the $2,471-2,472 range, followed by the $2,483-$2,484 zone, which marks the all-time high reached in July. A subsequent rise above the $2,500 psychological barrier would confirm a breakout from the broader one-month trading range, setting the stage for further near-term appreciation.