Spot gold maintains its position as safe-haven demand continues to drive upward momentum
In high-volatile trade, the precious yellow metal continues its upward trajectory, reaching a new high as the US Dollar posts a fresh five-month high, offset by demand for the safe-haven metal appeal.
Meanwhile, U.S. Federal Reserve Chair Jerome Powell tempered rate-cut expectations, marking a notable shift in the Fed’s outlook amid stronger-than-anticipated inflation readings for the third consecutive month.
Powell emphasized that recent inflation data hasn't given policymakers enough confidence to ease credit soon.
At an event in Washington, D.C., Powell highlighted that a "lack of further progress" on inflation indicates the central bank is unlikely to cut interest rates at its upcoming policy meeting.
This shift in sentiment suggests that rates may remain higher for a longer duration.
According to the latest Consumer Price Index, consumer prices rose 3.5% in March compared to the same month a year earlier.
Traders now anticipate the Fed delivering only one or two cuts this year, a significant change from initial expectations of six cuts or more at the beginning of 2024.
Over the past two years, the Fed's aggressive rate-hiking campaign has led to 11 rate hikes, bringing rates to a range of 5.25% to 5.50%.
From a technical standpoint, the Relative Strength Index (RSI) 3-day 'lookback' indicator shows positivity, but a ‘bearish divergence’ is evident, while the Moving Average Convergence Divergence (MACD) remains positive.
Additionally, the ADX (trend) indicator signals a ranging market.
With rising volatility, traders must reevaluate critical levels and adapt strategies.
A neutral stance prevails as we navigate unknown territory.
However, bearish divergence hints at a potential downward move.
Daily Chart Spot Gold
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