In this comprehensive analysis, Ultima Markets brings you an insightful breakdown of the XAUUSD for AUG 1 2024.
Key Takeaways
- Potential for Interest Rate Cuts: On Thursday, the Federal Reserve kept its benchmark interest rate unchanged in the range of 5.25% -5.50% for the eighth consecutive time, in line with market expectations. In their new policy statement, Federal Reserve officials acknowledged their recent progress in combating inflation. Federal Reserve Chairman Powell held a press conference after the FOMC meeting, stating that the second quarter inflation data has increased the Fed’s confidence and there is no longer a need to focus 100% on inflation. If the data meets the requirements, the earliest possible rate cut would be in September.
- Focus on Employment Data: From the latest interest rate decision of the Federal Reserve, the employment market data has become the key to the magnitude of the September interest rate cut. In July, ADP employment in the United States increased by 122000 people, falling short of the expected 150,000 and marking the smallest increase since January 2024. If the non-farm payroll data on this Friday reveals a weak job market, the US dollar might decline, leading to significant gains in non-US currencies and precious metals.
Technical Analysis
Daily Chart Insights
- Stochastic oscillator: The indicator sends a bullish signal below the 50-level line, indicating that short-term bullish forces have the upper hand and there is a probability that the market price will continue to rise. However, as the indicator has not completely fallen into the oversold signal, we are cautious that this rise is only a rebound, with the potential risk for further decline.
- Adjustment may End: In mid-July, we have pointed out the probability of gold prices rebounding and falling, but yesterday’s rise broke the structure of the downward adjustment and broke through the short-term transition zone (highlighted in red). The short-term trend is now mainly bullish, with attention on the area around the previous high of 2483.33.
H1 Chart Insights
- Stochastic Oscillator: The indicator repeatedly entered the overbought area and sent a bearish signal, indicating strong bullish momentum. It’s important to note that the market price is approaching a key resistance level, raising the possibility that gold prices may align with the indicators to signal a top divergence adjustment.
- Key resistance level: Gold rose strongly and broke through during the US session after rebounding and consolidating on the upward channel line, indicating the current strong bullish trend in gold. At present, it is hindered by the extended resistance level of 1.618 times Fibonacci, which is also near the neckline of the previous peak decline. If it successfully breaks through, it could aim for the previous high of 2483.72.
Pivot Indicator
- According to the trading central in Ultima Markets APP, the central price of the day is established at 2430,
- Bullish Scenario: Bullish sentiment prevails above 2430, first target 2457, second target 2473;
- Bearish Outlook: In a bearish scenario below 2430, first target 2412, second target 2395.
Conclusion
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Disclaimer
Comments, news, research, analysis, price, and all information contained in the article only serve as general information for readers and do not suggest any advice. Ultima Markets has taken reasonable measures to provide up-to-date information, but cannot guarantee accuracy, and may modify without notice. Ultima Markets will not be responsible for any loss incurred due to the application of the information provided.
