May 30, 2024

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Gold Price Finds Acceptance Above $2,000, Awaiting FOMC

2 min read
  • The bias is bullish, so further growth is natural.
  • The FOMC represents the most important event today.
  • Consolidating above the broken levels should announce a new bullish momentum.

The gold price saw an amazing rally on Tuesday. The precious metal is trading at $2,018 at the time of writing.

The bias has turned bullish, so the XAU/USD could try to approach fresh highs. Fundamentally, the price increased as the JOLTS Job Openings dropped from 9.97M to 9.59M, far below the 9.74M expected, while Factory Orders registered only a 0.9% growth versus the 1.3% growth estimated.

Today, the New Zealand Unemployment Rate and Employment Change came in better than expected. Later, the US data and the FOMC should shake the markets. The ISM Services PMI is expected to jump from 51.2 points to 51.8 points, while ADP Non-Farm Employment Change could be reported at 148K versus 145K in the previous reporting period.

Still, the FOMC Statement and FOMC Press Conference represent the most important events. The FED is expected to increase the Federal Funds Rate from 5.00% to 5.25%. A dovish speech should weaken the USD, while a hawkish speech can push the greenback higher. Furthermore, the ECB on Thursday and the NFP on Friday represent high-impact events.

Gold price technical analysis: Range breakout

Gold price
Gold price chart

Gold rallied after failing to retest the weekly S1 of $1,972 and the $1,969 static support. It has ignored the near-term resistance levels and is trading above the $2,011 range’s resistance.

The R1 ($2,007) and the broken downtrend line represent immediate downside obstacles. As long as it stays above these levels, the price of gold should jump higher.

The descending pitchfork’s warning line (wl1) represents a dynamic resistance. The weekly R2 of $2,026 represents an upside target as well. The bias is bullish, so a temporary consolidation may be a caution for further growth. Taking out the warning line and the R2 can activate another significant rally.

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