Gold XAUUSD Chart Technical Outlook set to bounce toward $2,336 on steady inflation, Fed decisions
Super Wednesday is here – US inflation and the Fed decision come on the same day, and markets are set to react strongly. I expect the Consumer Price Index (CPI) inflation report to show another small drop in price rises and the Fed to leave all options on the table.
After a day of fear on Tuesday, any sign of stability would be sufficient to calm markets, send Treasury yields down and yieldless Gold up. It would be better for the precious metal to get a Core CPI MoM read of 0.2%, but an “as expected” 0.3% would be steady enough. A slide in Core CPI YoY to 3.5% would also be good enough.
With the Fed’s dot plot, reducing rate cut expectations from three to two would be good news, but I expect a projection of only one cut to be sufficient for markets.
All in all, markets will be happy with any news which is not horrible, especially after several days of fear.
Gold faces resistance at $2,320, the recent high, and then by $2,336 a
