What could stop gold’s bullish momentum?

  • Economic events such as the US Consumer Price Index (CPI), FOMC minutes, and Central Bank decisions could be crucial factors to influence gold prices and market sentiment.

The end of the week brings a host of significant data releases, including the US Consumer Price Index (CPI), the FOMC minutes from the March meeting, and interest rate decisions from both the Bank of Canada and the European Central Bank (ECB). 

Import the BlackBull Markets Economic Calendar to iCloud, Google, or Outlook to get alerts direct to your inbox, enabling you to plan your positions in advance and seize trading opportunities.     

A hot CPI print may provide support for the USD and potentially limit gold’s climbs, or at least give some pause (or pullback) to allow for an entry point. The Bank of America revised its forecast for gold yesterday, anticipating that the precious metal will maintain an average price of $2,500 per ounce by the fourth quarter.   

An interesting note came from the Former St. Louis Fed President James Bullard (note included in FOMC meeting minutes, but interesting nonetheless) who said that the US Fed could already justify a rate cut on the data it currently has, but because it has time on its side, it probably will probably wait. 

Based on the daily chart, overbought conditions could potentially start to exert pressure on XAU/USD. The 20-day Simple Moving Average (SMA) is positioned more than $100 below the current trading price, albeit still well ahead of the 50-, 100-, and 200-day SMAs. 

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