Gold Prices Surge Ahead of US CPI Data: Investors Eye Inflation Trends

Gold prices trade higher ahead of US CPI data. It hit an intraday high of $2685  and currently trading around $2683.

Anticipated US CPI Release

The US Consumer Price Index for December 2024 is going to be announced, and it's likely to present a slight moderation in inflation. Economists foresee the year-on-year CPI going up to approximately 3.2%, as against 3.3% in November. The core CPI is expected to remain unchanged at 3.3%, meaning that inflation pressures continue unabated. Producer prices have been rising moderately according to recent reports. This might affect the next steps of the Federal Reserve. The CPI data are to be released on February 12, 2025. It should be well considered in terms of inflation patterns and probable interest rate decisions.

Rate Pause Probability Rises Significantly

According to the CME Fed Watch tool, the chances of a rate pause have increased to 97.30% up from 94.70 % a week ago.

Technical Analysis: Support, Resistance, and Trading Strategy

Gold prices are holding above short-term moving averages of 34 EMA and 55 EMA and long-term moving averages (200 EMA) in the 4-hour chart. Immediate support is at $2,650, and a break below this level will drag the yellow metal $2,630,$2600/ $2,570, $2,559, $2,536, and eventually $2,500. The near-term resistance is at $2700, with potential price targets at $2725/ $2,750-/$2775. It  is good to buy on dips around $2660, with a stop-loss  at $2,630 for a target price of $2,750