GOLD Price Analysis – May 19, 2023

Daily Price Outlook

Gold took a breather yesterday as the Fed's plans for tightening or rate cuts this year became less certain. The precious metal kicked back, enjoying a downtime of -0.7% at 59723. While some Fed officers cast doubts on a pause in rate increases come June, the report of the claim provided a boost, revealing the labor market's resilience.

Gold felt the pressure from the US debt ceiling debate, but it wasn't all bad news. The currency and Treasury rates reaped the rewards. Thomas Barkin from the Richmond Fed was uncertain if inflation would keep dropping until it hit the coveted 2% mark set by the US central bank.

Meanwhile, other Asian markets showed little interest in physical gold, but crafty Chinese dealers offered enticing discounts to lure customers. As local prices dipped from their recent record highs, India saw a glimmer of increased demand for the precious metal. Indian dealers sweetened the deal by offering discounts of up to $11 per ounce, a drop from the $23 discount last week.

However, gold demand in India took a dip of 17% in the March quarter, hitting its lowest level in 10 quarters. The World Gold Council predicts that demand will remain subdued even in the upcoming June and September quarters due to sky-high prices.

Gold is taking a breather, catching its golden rays, but the journey ahead remains uncertain. Stay tuned for more dazzling updates!

GOLD – Technical Outlook

On Friday, the price of gold experienced a slight recovery after reaching a support level around $1952. This led to an oversold condition, prompting sellers to cover short positions and initiate buying positions to take advantage of the lower prices. Currently, gold is trading around $1962 and could potentially reach the 23.6% Fibonacci retracement level at $1968.

Further demand may push the price to the 38.2% Fibonacci retracement level at $1978. Additionally, a bullish scenario could lead to levels of $1987 or $1995, representing the 50% and 61.8% Fibonacci retracement levels, respectively.

Technical indicators such as RSI and MACD are showing signs of sellers being exhausted, indicating a possible shift in market sentiment. Today's pivot point is expected to be around $1952, with support at $1940 and potentially lower at $1933.

Related:

    * EUR/USD Price Analysis – May 19, 2023

    * S&P500 (SPX) Price Analysis – May 19, 2023

    * GOLD Price Analysis – May 18, 2023