FxWirePro- Gold Weekly Outlook

Ichimoku Analysis (Weekly Chart)

Tenken-Sen- $1761.04

Kijun-Sen- $1875.71

Gold price lost its shine after the hawkish stance from Fed chairman Powell. The central bank chief said that Fed to continue its aggressive rate hikes to tackle inflation. US index Dow pared more than 1000 points after Fed chairman speech. The US dollar index breaks significant resistance at 109.30 after a long consolidation.

US Flash services and manufacturing PMI dropped to 44.1 and 51.3, well below expectations. US new home sales slumped to a 6-1/2 year low to 511K compared to an estimated 574K. US Richmond manufacturing slowed down to -8 vs forecast of -4. US new orders for manufactured goods came flat compared to a forecast of 0.90% While core durable goods orders rose by 0.30% in July. The US pending home sales dropped for the sixth time this year and slipped 1% in Jul.

According to the CME Fed watch tool, the probability of a 75 bpbs rate hike in Sep rose to 70.5% from 55% a week ago.

Factors to watch for gold price action-

Global stock market- Bearish (positive  for gold)

US dollar index – Bullish (Negative for gold)

US10-year bond yield- Bullish (negative for gold)

Technical:

The near–term support is around $1720, a breach below targets $1700/$1650. Significant reversal only below $1650. The yellow metal faces minor resistance around $1760, breach above will take it to the next level of $1775/$1800/$1820.

It is good to sell on rallies around $1748-50 with SL at around $1771 for TP of $1700/$1650.