Gold daily update: predicting the next move after consolidation
Hello, fellow traders!
📰 Key economic updates:
Germany IFO Business Climate Index dropped to 88.6 in June 2024, which is lower than expected 89.7 and 89.3 in May.
A lower-than-expected Ifo reading usually means more economic uncertainty in Germany, the largest economy in Europe. If this news causes the euro to weaken against other major currencies, especially the US dollar, it could indirectly push Gold prices higher.
This economic data might also encourage the European Central Bank (ECB) to delay interest rate hikes or even consider rate cuts to support the economy, which will be bullish for Gold.
On Monday, the dollar index (DXY) fell 0.5% against its rivals and benchmark 10-year U.S. Treasury yields edged down, making Gold more attractive for investors.
The market is currently anticipating the comments from Fed officials about potential rate cuts. According to the CME FedWatch Tool, traders are currently betting on a 66% chance of a Fed rate cut in September, which will significantly support non-yielding Gold.
📊 Let’s look at the data:
Gold’s seen a mix of ups and downs over the last month, reaching $2,387 before hitting the bottom at ~$2,286. After Friday's gold market nosedive, today's been pretty uneventful. Gold has been playing it safe in the range of 2330 and 2325, approaching neither resistance nor support zones.
However, some notable patterns start to emerge.
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