Gold price oscillates just below range upper limit at $2,200, bullish potential seems intact
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Gold price (XAU/USD) continues to struggle to break through the $2,200 mark and is currently oscillating in a range during the Asian session. The overnight hawkish remarks from Federal Reserve (Fed) Governor Christopher Waller have cooled rate cut hopes and pushed the US Dollar (USD) closer to the monthly top, acting as a headwind for gold. Traders are awaiting more cues about the Fed's policy path before placing fresh directional bets. The Fed projected a less restrictive monetary policy going forward and indicated that it remains on track to cut interest rates by 75 basis points in 2024. However, incoming US macro data suggests that the economy is in good shape and points to sticky inflation, which should allow the Fed to keep rates higher for longer. The release of the US Personal Consumption Expenditures (PCE) data will influence expectations about the Fed's rate-cut path and provide fresh impetus to the gold price. Central banks are the biggest buyers of gold, with emerging economies such as China, India, and Turkey quickly increasing their gold reserves. Gold is widely seen as a safe-haven asset and a hedge against inflation and depreciating currencies. The price of gold can be influenced by factors such as geopolitical instability, economic data, and the behavior of the US Dollar. From a technical perspective, gold is in a range-bound consolidation phase, with oscillators on the daily chart holding comfortably in the positive territory, supporting the potential for an eventual breakout to the upside. Key support levels for gold are around $2,173, $2,164-2,163, and $2,146-2,145, while resistance is seen at $2,200 and the record high of $2,223.
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