On Friday, Gold traded near $1,910 an ounce, its lowest level in three months. This price move is due to aggressive monetary tightening and hawkish comments from major central banks putting pressure on the precious metal. Federal Reserve Chairman Jerome Powell stressed in his speech to Congress that the members of the Federal Open Market Committee (FOMC) now agree on the need to further raise interest rates because inflation remains too high. In the markets, the Federal Reserve is expected to raise rates by another 25 basis points in July. At the same time, the Bank of England and the Bank of Norway surprised the markets by raising rates by 50 basis points more than expected, and the Swiss National Bank raised rates by 25 basis points. An increase in interest rates leads to an increase in the opportunity cost of holding gold, which reduces its attractiveness, as a result, investors leave Gold to look for more interesting investment options.
GOLD Weekly Forecast June 26 — 30, 2023
Gold completes the trading week with a correction near the 1913 area. XAU/USD quotes continue to move as part of a strong correction and a bullish channel. The potential remains to complete the formation of the “Wedge” reversal pattern. Moving averages indicate the presence of a bullish trend for Gold. Prices are again testing the area between the signal lines, which indicates pressure from buyers and a potential continuation of price growth. At the moment, we should expect an attempt to develop a decline in prices and a test of the support level near the 1905 area. Further, a rebound in prices up and continued growth of Gold with a potential target above the level of 2045.
An additional signal in favor of the rise in quotes and prices for Gold in the current trading week of June 26 — 30, 2023 will be a rebound from the support line on the relative strength index (RSI). The second signal will be a rebound from the lower border of the bullish channel. Cancellation of the growth option for XAU/USD quotes will be a fall in price and a breakdown of the 1880 area. This will indicate a breakdown of the support level and a continued fall in Gold prices with a target below the level of 1835. Confirmation of the growth in the value of the asset will be a breakdown of the resistance area and closing of quotes above the level of 1960, which will indicate on the breakdown of the upper border of the “Wedge” reversal pattern and the beginning of the pattern with targets at the top.
GOLD Weekly Forecast June 26 — 30, 2023 suggests an attempt to develop a decline and test the support level near the area of 1905. Then, the continued growth in Gold prices with a target above the level of 2045. A test of the trend line on the relative strength index (RSI) will come out in favor of the rise in quotes. Cancellation of the growth option for GOLD will be a fall and a breakdown of the level of 1880. This will indicate a continued decline in quotes to the area below the level of 1835.
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