XAUUSD rebounded sharply on Thursday's trading day and weakened rapidly in the first half of the Asian trading session today, Friday (May 16). Gold is currently trading at $3,210/oz, equivalent to a decrease of $30 on the day, down about 0.93% as of the time of writing.XAUUSD accelerated their recovery on Thursday as weak US economic data fueled expectations of a Federal Reserve rate cut and weighed on the US dollar. At the same time, Russian President Vladimir Putin’s absence from Russia-Ukraine peace talks in Turkey also prompted some safe-haven buying. Information surrounding the Russia-Ukraine talks is brought to readers through brief comments during the day.
Data released on Thursday showed that the US producer price index (PPI) unexpectedly fell in April and retail sales growth slowed significantly, while the consumer price index (CPI) for April released earlier in the week rose less than expected. The data showed that the US PPI unexpectedly fell 0.5% month-over-month in April, while the market expected a growth of 0.2%; the core PPI fell 0.4%, also below the expected growth of 0.3%. Meanwhile, US retail sales increased slightly by 0.1% month-over-month in April, slowing significantly from March's 1.7%.
Thursday’s data provided more room for the Federal Reserve to cut interest rates and market expectations to become more dovish. Gold itself does not generate interest rates, and when rates fall, it increases the appeal of gold.
However, the impact from the data was not sustainable enough to generate a stronger rally, while new developments around the Russia-Ukraine talks are showing a positive trend. Gold is not benefiting from a risk-off environment.
Technical Outlook Analysis
XAUUSD On the daily chart in the short term, gold is still in a position to decline in the short term with pressure from the EMA21 and the 0.382% Fibonacci retracement point as the nearest resistance. Meanwhile, in terms of momentum, the Relative Strength Index (RSI) is also showing signs of folding as it retests the 50 level, which is noted as the closest resistance in terms of momentum to the current position of the RSI.
For now, the downside is also limited by the $3,200 base level, which is currently the nearest support and once it is broken below, gold is likely to continue its decline with a target of around $3,163 in the short term, which is the 0.618% Fibonacci retracement level, rather than $3,120.
For the day, gold still has a bearish technical outlook with the current positions listed below.
Support: $3,200 – $3,163 – $3,120
Resistance: $3,250 – $3,292
SELL XAUUSD PRICE 3286 - 3284⚡️
↠↠ Stop Loss 3290
→Take Profit 1 3278
↨
→Take Profit 2 3272
BUY XAUUSD PRICE 3159 - 3161⚡️
↠↠ Stop Loss 3155
→Take Profit 1 3167
↨
→Take Profit 2 3173
Note
🔴Gold SPOT lost $3,200 an ounce, down 1.26% on the day.Note
![GOLD MARKET ANALYSIS AND COMMENTARY - [May 19 - May 23]](https://tradingview.sweetlogin.com/proxy-s3/j/JVEoKcGq_mid.png)
Note
Immediately after Moody’s downgraded the US credit rating from AAA to AA1, the market was shocked: gold increased by more than 40 USD, reaching 3244 USD/oz in the Asian session; the USD weakened and US stock futures fell.Note
DXY index continues to plummet below 100.20Note
According to technical analysis, gold is on the rise with the next resistance levels being 3,350 – 3,400 – 3,438 and could head towards the historical peak of 3,500 USD/oz if it does not fall below the support level of 3,300 USD.
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🔰| Forex trading
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🧩Consulting on Risk Management
🧩Account management
🧩Forex signals have a high win rate
🚨🚨🚨FREE SIGNALS: t.me/+8q3AxDD9CsRjYzI1
🧩Get an average of 1200 pips per month
🧩Consulting on Risk Management
🧩Account management
🧩Forex signals have a high win rate
🚨🚨🚨FREE SIGNALS: t.me/+8q3AxDD9CsRjYzI1
Related publications
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.