Gold Price (XAU/USD) Analysis, Price, and Chart
- Gold is respecting short-term support ahead of the Fed.
- Quarterly Economic Projections will be key going forward.
Recommended by Nick Cawley
How to Trade Gold
For all market-moving data releases and events, see the DailyFX Economic Calendar
The Federal Reserve is expected to leave interest rates unchanged later today but may warn that, data-dependent, interest rates may rise further in July as part of the central bank’s ongoing struggle with inflation. Recent inflation data, both consumer and factory, edged lower last month but still remains far too high for Fed chair Jerome Powell.
USD Breaking News: US PPI Joins CPI in Move Lower, Emboldening the Fed
The Quarterly Economic Projections are also released today with the dot plot a closely watched visual for traders to gauge the FOMC’s thoughts on rates in the weeks ahead. These Economic Projections will also show updated Fed assumptions for GDP, unemployment, and inflation for the next three years.
Ahead of today’s meeting, gold is nudging $1,960/oz. aided in part by today’s weaker-than-expected PPI release. The precious metal has tested, and rejected, a support zone on either side of $1,935/oz. and it will take a strong hawkish surprise at tonight’s meeting to press through this level. However, a hawkish outlook cannot be overlooked as Fed chair Powell will want to leave himself with the maximum flexibility for the next few meetings.
Gold Daily Price Chart – June 14, 2023
Chart via TradingView
| Change in | Longs | Shorts | OI |
| Daily | 17% | -19% | 4% |
| Weekly | 11% | -21% | 1% |
Retail Traders Boost Net-Long Positions
Retail trader data show 73.68% of traders are net-long with the ratio of traders long to short at 2.80 to 1.The number of traders net-long is 15.77% higher than yesterday and 9.86% higher from last week, while the number of traders net-short is 18.61% lower than yesterday and 16.78% lower from last week.
We typically take a contrarian view to crowd sentiment, and the fact traders are net-long suggests Gold prices may continue to fall. Traders are further net-long than yesterday and last week, and the combination of current sentiment and recent changes gives us a stronger Gold-bearish contrarian trading bias.
What is your view on Gold – bullish or bearish?? You can let us know via the form at the end of this piece or you can contact the author via Twitter @nickcawley1.
Leave a Reply