- The bias is bullish as long as it stays above the median line (ml).
- The US data should bring more action later today.
- The upper median line (uml) represents the first target.
The gold price pared FOMC-led losses in the last New York session. The metal is at $1,966 at the time of writing.
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The US dollar remains under strong downside pressure. Hence a deeper drop should force the yellow metal to jump higher in the short term.
Fundamentally, the XAU/USD turned to the upside after the ECB. As expected, the Main Refinancing Rate was increased to 4.00% from 3.75%.
Furthermore, the US data came in mixed. Capacity Utilization Rate, Industrial Production, Unemployment Claims, Import Prices, and Philly Fed Manufacturing Index indicators reported poor data.
Today, the Bank of Japan left the monetary policy unchanged. The BOJ Policy Rate remained at -0.10%, as expected. Furthermore, the Eurozone Final CPI and Final Core CPI came in line with expectations.
Later, the US Prelim UoM Consumer Sentiment represents a high-impact event and is expected to reach 60.1 points in June versus 59.2 points in the previous reporting period.
The Prelim UoM Inflation Expectations indicator will be released as well. Better-than-expected US data could save the USD from the downside and could drag the XAU/USD lower again. On the other hand, poor US data should boost the price of gold.
Gold price technical analysis: Bullish bias
Technically, the XAU/USD stabilized above the weekly pivot point of $1,957. Now it has jumped above the upper median line (UML) of the descending pitchfork, representing a major dynamic resistance.
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Validating the breakout may announce further growth. The first upside target is represented by the ascending pitchfork’s upper median line (uml).
Testing the UML and the weekly pivot point may announce a new bullish momentum. A valid breakout could activate a meaningful uptrend through the upper median line (uml) and above the weekly R1 (1,976).
In the short term, the bias remains bullish as long as it stays above the ascending pitchfork’s median line (ml).
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