Gold Price Update

Key Points:

• Gold prices have experienced a decline for three consecutive days.
• The bullion remains above significant benchmarks.
• Next week’s events warrant attention.

The Technical Brothers seem to enjoy the current situation. There hasn’t been any significant news to shift focus back to the usual economic patterns or candlestick analysis.

📉 Gold prices drop

• The market, particularly for Xauusd, focused more on technical aspects as of Friday morning, rather than economic headlines. Perhaps it’s because there just aren’t that many exciting developments this week that could drive investor interest.
• It’s a prime time for technical analysts to make their moves. Right now, the Bears are in control, with gold losing about 0.7% early today, marking three days of losses.
• Bullion prices fell from an opening price of $3,370 per ounce to a low of $3,342. This translates to a 2.5% loss for the week, breaking a two-week winning streak.

💪 Gold vs Major Assets: Notable Performance

• Nonetheless, the long-term outlook still feels quite strong. Gold continues to outperform many major assets, showing a return of around 28% so far this year, which is significantly better than the S&P 500’s 1.9% and Bitcoin’s 12%.
• A recent event on Wednesday had a short-term negative impact on gold, as the Federal Reserve decided to keep interest rates at 4.5% due to rising inflation expectations amid uncertainties from tariffs.
• With these increased inflation expectations, the US dollar has gained strength, which has contributed to the decline in gold prices. As opportunity costs rise, investors are turning to bonds with guaranteed returns rather than risking investment in gold.

👀 Looking Ahead to Next Week

• Given this backdrop, what’s next for gold? Technically, there’s double-top resistance at the high of $3,450 per ounce. If the Bulls manage to break through, the next potential resistance could be the session high of $3,500 per ounce.
• Gold also remains above three critical simple moving averages (SMA): the 50-day is around $3,317, the 100-day at $3,139, and the 200-day at $2,901. According to technical analysis, the upward trend is still intact.
• However, some important economic news is on the horizon. Investors should keep an eye on next week’s events and reports. Notably, US GDP data will be released on Thursday, and the PCE, a favored inflation indicator by the Fed, will follow on Friday.