Basic overview
Gold continues to consolidate in a tight range as the markets await the US CPI report due on Wednesday. Overall, nothing has changed in terms of basics. The Fed is expected to cut 25 bps next week and deliver at least two more rate cuts in 2025.
In the bigger picture, the trend should remain bullish amid the Fed's easing cycle, but the short-term corrections are likely to be triggered by the payback in rate cut expectations. For now, the market is looking good with three rate cuts by the end of 2025 as the price did not change despite a lot of strong US data.
The US CPI report is set to be a key event for gold. Better-than-expected figures are likely to trigger further selling, while lower-than-expected data should support the precious metal to new highs.
All in all, we should not expect the same strong rise in gold in the future that we have become accustomed to in the past few years as conditions generally changed. .
In fact, the geopolitical risk premium should be easier with the Trump administration. Real output could either continue to fall slowly or just range for a long time. Last but not least, the new Treasury Secretary should allay fears of US fiscal corruption.
Gold Technical Analysis – Daily Chart
Gold every day
On the daily chart, we can see that gold is still consolidating around the main line of motion. This is where the buyers continue to step into a position to rally into a new all-time high. On the other hand, the sellers need the price to break below the trend line and the 2600 support to gain control and focus on falling into the next major move around the 2400 level.
Gold Technical Analysis – Timetable 4 hours
Gold 4 hours
On the 4 hours chart, we can see that the price is stuck in a range between the levels of 2660 and 2620. It seems that the market participants will continue to play the range until we get a break out of it each side. On the downside though, beware of potential breakouts as the sellers need to break below the 2600 support to confirm the breakout.
Gold Technical Analysis – 1 Hour Time Table
Gold 1 hour
On the 1 hour chart, there isn't much else we can add here as the choppy price action is likely to continue until the US CPI report due on Wednesday. The buyers will want to see lower than expected numbers to get more conviction for a rally, while the sellers will look for higher than expected numbers to push the price lower. The red lines define the average daily range for today.
Catalysts to come
this week it will be quieter on the data front. On Wednesday, we have the US CPI report which is also going to be the highlight of the week. On Thursday, we get the latest US jobless claims and US PPI numbers.
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