XAUUSD Chart Technical Outlook Gold could be on the verge of a correction, US PMIs will matter
Gold has been in the hands of the bears after it broke out of support this week near $1,930. The yellow metal has made a significant downside extension ahead of the US PMIs on Friday and following the Federal Reserve’s Chairman Jerome Powell’s mixed messages. More rate hikes are on the way in order to contain inflation but the Fed is data-dependent. This makes Friday’s data a key event and perhaps we will see a deceleration in the price ahead of the data. Manufacturing will be what will be key as the PMI registered its first decline this year in May, while the services PMI continued to improve, posting its fifth consecutive gain last month. Technically, we are testing support around the daily ATR so there is little juice left in this move for the time being and a correction could be on the cards:
