Gold XAUUSD Chart Technical Outlook

Gold XAUUSD Chart Technical Outlook CPI data meet forecast neutral least impact expected
Exit from EURGBP trade nearly neutral.

Gold benefits from falling US yields, needs weak US data to extend gains beyond $1,983*

XAU/USD is trading at the highest levels since early June – with the underlying driver being last week’s soft US inflation report. More recently, marginally better US Retail Sales only triggered a small dip. However, investors expect inflation to fall, pushing yields down – and yieldless Gold rises with it.

The 4h-RSI is just above 70, indicating overbought conditions. The first attempt to break above $1,983, a line from that time in June, failed. We could see further consolidation in the $1,973-$1,983 range before another move to the upside, moving toward $2,000. Support below $1,979 is at $1,968 and then $1,963. 

What could move Gold out of the range? US Housing Starts and Building Permits are due out at 12:30 GMT. If both miss estimates, we could see XAU/USD break higher. If both beat estimates, the precious metal could slip lower. In most cases, the figures offset each other. Any shakeout in response to the data could trigger further consolidation before the next move up.

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