Gold (XAU/USD) price is once again gaining bullish momentum due to the weakness shown by the US dollar. Bullion prices rose 0.54% on Thursday as the metal attempted to break out after a week of consolidation. The $2,040 level remains the biggest resistance on the chart which has been breached today.
However, the price is yet to close above this level and that might give bulls enough confidence to target the macro resistance of $2,075 once again. The border market sentiment may act as a catalyst for this retest as the investors are deploying their capital with full conviction that the tightening cycle is nearly over.
In light of the most recent economic data, Bank of America analysts are now expecting the Federal Reserve to start cutting interest rates from March 2024. In fact, the CME Fed Watch Tool is predicting a 12.4% chance of a rate cut in the January 2024 FOMC meeting.
Another reason behind the bullish Gold price prediction is the current consolidation below the previous all-time high. The only thing bulls need is to find some strength above $2,075 and then a new wave of breakout buyers may step in to take it higher.
The invalidation of this bullish thesis will be a breakdown below $1,985, which is a strong support level.
This post was last modified on Dec 21, 2023, 14:48 GMT 14:48