Fundamental
Overview
Gold got stuck in a range recently
as the market is now waiting for the details of the first trade deal, which is
said to be announced this week or the next. We reached an inflection point last
week following some very positive Trump’s comments and as the stagflationary
risk kept on being priced out, gold continued to edge lower.
The stagflationary pricing
got gold to such high prices, and as we start to price out that risk, it’s
normal to see a correction, especially considering that “long gold” has been
the most crowded trade.
In the bigger picture, gold
remains in an uptrend as real yields will likely continue to fall amid Fed
easing. But in the short-term more positive news on the tariffs front should see
more downside for gold as the market readjusts to new conditions.
Gold
Technical Analysis – Daily Timeframe
Gold Daily
On the daily chart, we can
see that gold got stuck in a consolidation around the 3300 level as the market
awaits more info on the first trade deal. From a risk management perspective,
the buyers will have a better risk to reward setup around the previous high at
3167 to position for further upside, while the sellers will look for a break
lower to increase the bearish bets into the major trendline around the 3100
level.
Gold Technical Analysis
– 4 hour Timeframe
Gold 4 hour
On the 4 hour chart, we can
see more clearly the range between the 3258 support and the 3367 resistance.
The market participants will continue to play the range until we get a breakout
on either side.
Gold Technical Analysis
– 1 hour Timeframe
Gold 1 hour
On the 1 hour chart,
there’s not much else we can add here as the buyers will step in around the
support and increase the bullish bets on the break of the resistance, while the
sellers will pile in around the resistance and increase the bearish bets on the
break of the support. The red lines define the average daily range for today.
Upcoming
Catalysts
Today we have the US Job Openings data and
the US Consumer Confidence report but the focus will be on Bessent’s and
Lutnick’s remarks. Tomorrow, we have the US ADP, the US Q1 GDP, the US PCE and
the US Employment Cost Index. On Thursday, we get the latest US Jobless Claims
figures and the US ISM Manufacturing PMI. On Friday, we conclude the week with
the US NFP report. As a reminder, the market is focused on tariff related news
at the moment, so the data is not as market-moving as it used to be in the past
months.
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