View attachment 34572
The daily chart shows that the gold price was in a consolidation phase as it moved sideways close to the nine- and fourteen-day exponential moving averages (EMAs), while Friday the price was trading over $2,630.00. Showing a neutral attitude, the 14-day Relative Strength Index (RSI) stays at a level somewhat below 50. Should buying interest rise significantly, the commodity might be clearly moving above 50.
The XAU/USD pair may attempt to reach the psychological threshold of $2,700.00 on the upside, given the subsequent barrier being its monthly high of $2,726.34.
The 14-day and nine-day EMAs, which range in value from $2,631.40 to $2,627.44, respectively, immediately support the XAU/USD pair. A violation of these levels could aggravate the selling pressure; hence, gold could drop to its monthly lowest of $2,583.39.
View attachment 34573
Over human history, gold has been a vital tool for both storage of value and medium of trade. Apart from its shine and use in jewelry, the precious metal is currently mostly seen as a safe-haven asset, which means it is a beneficial investment during difficult times. Since it is not dependent on any one issuer or government, gold is also often considered a hedge against inflation and devaluing currencies.
Central institutions hold the most gold. Usually diversifying their reserves, central banks buy gold to boost the seeming strength of the economy and the currency, therefore supporting their currencies in times of uncertainty. The significant gold reserves of a nation help to increase its solvency. Data from the World Gold Council shows that in 2022, central banks raised reserves by 1,136 tons of gold, equivalent to around $70 billion. Since the beginning of recordkeeping, this is the most important annual purchase. Emerging economies including China, India, and Turkey's central banks are fast building their gold stockpiles.
Both gold and the US dollar, as well as US Treasury bonds, important reserves, and safe-haven assets, have an inverse relationship. Gold often appreciates in stormy times when the dollar depreciates, enabling central banks and investors to diversify their assets. Moreover, inversely linked with gold are risk assets. In unpredictable markets, investors prefer gold during sell-offs, but during a stock market boom, its price typically declines.
The pricing will change for a number of reasons. Geopolitical uncertainty or worries about a catastrophic recession can quickly raise the price of gold, given its reputation as a safe haven. Whereas the yellow metal is usually affected by a rising cost of money, gold, a yieldless asset, typically gains value when interest rates are lowered. Still, the behavior of the US Dollar (USD) controls the price of the asset in dollars (XAU/USD), hence guiding most moves. A strong dollar usually keeps the price of gold constant, while a reduced dollar is more likely to lead to an increase in price.
Forward-looking statements on these pages carry hazards and uncertainty, so they are informative. The markets and tools mentioned on this page are meant only for informative reasons; they should not be used as advice to buy or sell any asset. You really should do thorough research on your own before deciding what to invest in. FXStreet offers no guarantee that this data is error-free, mistake-free, or materially misstatements-free. Furthermore, FXStreet does not guarantee the accuracy of this material.
Investing in open markets has a lot of risk; thus, you may lose all or a part of your money in addition to emotional turmoil. All risks, losses, and expenses connected to investing—including the total loss of principle—are your responsibility. This article's points of view and opinions are those of the writers; they do not always reflect FXStreet's official policy or stance or that of its sponsors. The material at the end of the links on this page is not the responsibility of the author.
Unless otherwise stated in the body copy, the author of this article has no business affiliation with any firm mentioned at the time of writing and no stock position. The author has not received any payment for writing this article, except from FXStreet.
Neither the author nor FXStreet provide individual recommendations. The author does not guarantee the completeness, correctness, or fit of this material. FXStreet and the author disclaim all responsibility for any mistakes, omissions, losses, injuries, or damages resulting from the display or use of this material, excluding mistakes and omissions.
Neither the author nor FXStreet are registered investment advisers; this is not meant to be investment advice.
As the US dollar rises, gold's value is under downward pressure.
- The US Dollar Index (DXY), which is presently trading at 108.00, a little down from its highest point since November 2022, measures the value of the US Dollar (USD) in respect to its six main rivals. Any further strengthening of the greenback could limit the upward potential of dollar-denominated precious commodities, notably gold. This is because a rising USD increases the cost of these assets for holders of other currencies.
- Still, the non-interest-bearing gold might find favor given Friday's subdued US Treasury bond rates. The rates on the 2-year and 10-year bonds, respectively, at the time of writing are 4.33% and 4.58%.
- On Thursday, the Federal Security Service of Russia announced that it had effectively foiled many murder attempts by Ukrainian intelligence aiming at high-ranking Russian officials and their families in Moscow. According to Reuters, the CIA said they planned to carry out the strikes hiding explosives in power banks or document folders.
- Meanwhile, Gaza officials reported that an Israeli airstrike killed five Palestinian reporters. Still, the Israeli military claimed that the people were members of Islamic Jihad under the cover of media professionals. Medical experts claim that Israeli attacks throughout the Palestinian enclave claimed the lives of 31 people, five of whom were killed.
- The Federal Reserve changed its monetary policy stance this week by projecting a more cautious view of additional rate cuts in 2025, suggesting This development emphasizes the doubts about future policy changes in the framework of the expected economic policies of the incoming Trump government.
Currently pushing the 14- and nine-day exponential moving averages, the gold price stays below $2,650.
The daily chart shows that the gold price was in a consolidation phase as it moved sideways close to the nine- and fourteen-day exponential moving averages (EMAs), while Friday the price was trading over $2,630.00. Showing a neutral attitude, the 14-day Relative Strength Index (RSI) stays at a level somewhat below 50. Should buying interest rise significantly, the commodity might be clearly moving above 50.
The XAU/USD pair may attempt to reach the psychological threshold of $2,700.00 on the upside, given the subsequent barrier being its monthly high of $2,726.34.
The 14-day and nine-day EMAs, which range in value from $2,631.40 to $2,627.44, respectively, immediately support the XAU/USD pair. A violation of these levels could aggravate the selling pressure; hence, gold could drop to its monthly lowest of $2,583.39.
XAU/USD: Daily Plot
View attachment 34573
Golden Questions
Over human history, gold has been a vital tool for both storage of value and medium of trade. Apart from its shine and use in jewelry, the precious metal is currently mostly seen as a safe-haven asset, which means it is a beneficial investment during difficult times. Since it is not dependent on any one issuer or government, gold is also often considered a hedge against inflation and devaluing currencies.
Central institutions hold the most gold. Usually diversifying their reserves, central banks buy gold to boost the seeming strength of the economy and the currency, therefore supporting their currencies in times of uncertainty. The significant gold reserves of a nation help to increase its solvency. Data from the World Gold Council shows that in 2022, central banks raised reserves by 1,136 tons of gold, equivalent to around $70 billion. Since the beginning of recordkeeping, this is the most important annual purchase. Emerging economies including China, India, and Turkey's central banks are fast building their gold stockpiles.
Both gold and the US dollar, as well as US Treasury bonds, important reserves, and safe-haven assets, have an inverse relationship. Gold often appreciates in stormy times when the dollar depreciates, enabling central banks and investors to diversify their assets. Moreover, inversely linked with gold are risk assets. In unpredictable markets, investors prefer gold during sell-offs, but during a stock market boom, its price typically declines.
The pricing will change for a number of reasons. Geopolitical uncertainty or worries about a catastrophic recession can quickly raise the price of gold, given its reputation as a safe haven. Whereas the yellow metal is usually affected by a rising cost of money, gold, a yieldless asset, typically gains value when interest rates are lowered. Still, the behavior of the US Dollar (USD) controls the price of the asset in dollars (XAU/USD), hence guiding most moves. A strong dollar usually keeps the price of gold constant, while a reduced dollar is more likely to lead to an increase in price.
Forward-looking statements on these pages carry hazards and uncertainty, so they are informative. The markets and tools mentioned on this page are meant only for informative reasons; they should not be used as advice to buy or sell any asset. You really should do thorough research on your own before deciding what to invest in. FXStreet offers no guarantee that this data is error-free, mistake-free, or materially misstatements-free. Furthermore, FXStreet does not guarantee the accuracy of this material.
Investing in open markets has a lot of risk; thus, you may lose all or a part of your money in addition to emotional turmoil. All risks, losses, and expenses connected to investing—including the total loss of principle—are your responsibility. This article's points of view and opinions are those of the writers; they do not always reflect FXStreet's official policy or stance or that of its sponsors. The material at the end of the links on this page is not the responsibility of the author.
Unless otherwise stated in the body copy, the author of this article has no business affiliation with any firm mentioned at the time of writing and no stock position. The author has not received any payment for writing this article, except from FXStreet.
Neither the author nor FXStreet provide individual recommendations. The author does not guarantee the completeness, correctness, or fit of this material. FXStreet and the author disclaim all responsibility for any mistakes, omissions, losses, injuries, or damages resulting from the display or use of this material, excluding mistakes and omissions.
Neither the author nor FXStreet are registered investment advisers; this is not meant to be investment advice.