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XAU/USD Technical Outlook – 8, Dec

Gold price regained the downward-pointing 21-Simple Moving Average (SMA) on the four-hour chart, now at $1,781, having defended that critical mildly bullish 50SMA support at $1,774.

Despite the downside break from the rising wedge seen earlier this week, bulls continued defying bearish expectations. Acceptance above the 21SMA will initiate a meaningful recovery toward the $1,800 mark. The next upside target is pegged at the multi-month highs at $1,810.

The tide seems to have turned in favor Gold buyers, as the Relative Strength Index (RSI) has swung back into bullish territory. The rising wedge breakdown on the four-hour chart remains in play, keeping Gold price on the defensive in the lower range of this week’s trading range so far.

On the flip side, a four-hourly candlestick closing below the 21SMA resistance-turned-support could reinforce the bearish momentum, bringing the 50SMA back on sellers’ radars. The horizontal 100SMA at $1,764 will be a tough nut to crack for Gold bears on their way to the $1,750 psychological level.

XAU/USD Technical Outlook- 5, Dec

Gold price is retreating to test the critical 200-Daily Moving Average (DMA) at $1,796, at the time of writing.

Gold bulls reclaimed that barrier for the first time since mid-June on Thursday.

The 14-day Relative Strength Index (RSI) has turned flat just beneath the overbought territory, justifying the latest leg down in Gold price.

Should the 200DMA resistance-turned-support give way, then a drop toward the November 15 high at $1,787 cannot be ruled out.

The next corrective target is seen at the previous day’s low of $1,768, below which floors will open up for a test of the bullish 21DMA at $1,749.

Alternatively, Gold buyers year for a weekly closing above the 200DMA, above which the $1,800 mark will be challenged once again.

Further up, the previous day’s high at $1,805 and the August 10 top at $1,808 will be put to test.

Week Ahead in FX (5, Dec – 9, Dec)

Major Economic Events:

RBA monetary policy decision (Dec. 6, 3:30 am GMT) – First up, we’ve got Australia’s central bank scheduled to announce their rate decision early in the week

Australia’s Q3 GDP (Dec. 7, 12:30 am GMT) – The action ain’t over for Aussie pairs even after the RBA decision, as the country’s third quarter GDP is up for release the next day.

BOC monetary policy statement (Dec. 7, 3:00 pm GMT) – Canada’s central bank is also expected to announce a 0.25% interest rate hike this week, slowing down from its earlier 0.50% rate increase.

U.S. leading inflation data – Uncle Sam has a couple of leading indicators on inflation to watch out for, namely the ISM services PMI due early in the week and the PPI report scheduled on Friday.

Chinese CPI and PPI (Dec. 9, 1:30 am GMT) – Weaker price pressures are eyed for China, as both the CPI and PPI might print subdued readings for November.


Forex Market Recap : 12 Sep – 16 Sep

News and Economic Update:

  • President Zelensky says Ukraine retook 6K sqm from Russian control this month
  • U.S. Consumer prices rose in August and the annual growth rate slowed less than expected
  • U.K. headline consumer inflation slowed in August to 9.9% y/y but still remains way hot; core CPI ticked higher to 6.3% y/y
  • ZEW economic sentiment in Europe weakened to -60.7 vs. -54.9 previous
  • Australia’s unemployment rate ticked higher to 3.5% and net jobs gain came in below expectations as 33.5K
  • EIA crude oil inventories rose by 2.4M barrels
  • The German government took temporary control of two subsidiaries of the Russian energy giant Rosneft on Friday
  • FedEx Corp. sees business conditions deteriorating, and possibly will get worse, fueling global recession bets further ahead of the weekend.
  • Russian President Vladimir Putin pledged to up attacks on Ukraine’s civilian infrastructure, and pledging to continue military operation despite recent setbacks.
  • In August, the U.S. consumer price index rose by 0.1% m/m . The inflation gauge increased 0.6% when food and energy were excluded, which is higher than anticipated.
  • U.S. budget deficit widens to $220B in August, up by 29% from the same month last year
  • Homebuyers’ demand for U.S. mortgages declined 29% since last year as interest rates rise above 6%.
  • U.S. industrial production contracts by 0.2% (vs. 0.2% uptick expected) on lower utilities output
  • UK July GDP up by 0.2% vs. 0.3% expected, -0.6% in June
  • UK’s industrial production dips by 0.3% vs. 0.4% expected, -0.9% in June
  • UK manufacturing production improves by 0.1% vs. 0.3% expected, -1.6% previous
  • GDP grew in July by +0.2% q/q but the outlook remains one of recession – NIESR
  • The seasonally adjusted Italian industrial production index rose 0.4% m/m in July 2022. The recent three months’ average dropped 1.6% from the prior three.
  • According to Bundesbank President Joachim Nagel, the European Central Bank would have to keep raising interest rates if the current trend in consumer prices continues.
  • ZEW’s economic sentiment index for Germany declined to -61.9 from -55.3 in August. Reuters economists predicted -60.0 for September.
  • Swiss producer prices dip by another 0.1% vs. estimated 0.1% uptick
  • Canadian manufacturing sales declined 0.9% to $71.6B in July, mainly driven by the primary metal, petroleum and coal, and furniture and associated products industries.
  • Canada Housing Starts for August: -3% m/m to 267,443 units
  • NZ current account deficit narrows from 6.5B NZD to 5.22B NZD in Q2 2022
  • Australian Westpac consumer sentiment index rebounded by 3.9% m/m vs. -3% m/m previous
  • AU new home sales down by another 1.6% in August after 13.1% slide in July
  • Australia’s MI inflation expectations slowed from 5.9% to 5.4%
  • Australia added 33.5K jobs in August vs. estimated 35.5K gain
  • Japan’s core machinery orders surprisingly gain by 5.3% vs. 0.6% decline expected in July


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