FXTM information and reviews
FXTM
95%
OctaFX information and reviews
OctaFX
94%
XM information and reviews
XM
93%
FXCC information and reviews
FXCC
92%
Libertex information and reviews
Libertex
91%
HFM information and reviews
HFM
89%

Gold Shows Signs of Life, But Heads Towards Another Losing Month


28 September 2022

The precious metal is largely considered as a hedge to inflation, but it has not confirmed this status during the current year. It did kick it off with a rally, but as the Fed begun hiking rates back in March, things changed dramatically. The central bank started conservatively, but became much bolder over the summer, delivering this month the third consecutive 0.75% rate increase, in the most aggressive cycle since at least the mid-1990s. More to it, officials have pointed to more tightening ahead, in order to bring down inflation and avoid the de-anchoring of expectations.

This policy has been a massive source of strength for the US Dollar, which has not allowed gold to act as an inflation hedge and has sent it to a free fall. XAU/USD is drawing to the end of its sixth straight losing month, having already closed two weeks below the critical 1,682-77 region we had highlighted in our previous analysis.

This marks the 38.2% Fibonacci of the 2015 Low/2020 High rally and the neckline of the Double-Top formation - with the 2020 record high and the 2022 high acting as the relevant tops. This exposes it to the next Fibonacci level at 1,561 and could open the door to even bigger losses, potentially towards the Monthly EMA200 (at around 1,290). Looking at the H4 chart, XAU/USD puts up a fight today, reacting from Monday's slump to the lowest level since April 2020 and the height of the pandemic. Furthermore, the Relative Strength Index diverged higher and this could potentially be a sign of further near-term recovery.

However, the upside looks unfriendly and we struggle to see at this stage how the precious metal can challenge the EMA200 in the 1,700-5 area. Despite today's signs of life, XAU/USD is in risk of fresh lows below 1,608, although a steeper decline towards and beyond 1,570, will likely require fresh impetus.

This week's economic calendar includes key economic data points for the US, such as the GDP and PCE Inflation updates, as well as a slew of Fed speakers, including chair Powell.

#source

Share: Tweet this or Share on Facebook


Related

The Downfall of Euro in 2022: the Analysis of its Reasons, the Current Situation, and the Objective Forecast
The Downfall of Euro in 2022: the Analysis of its Reasons, the Current Situation, and the Objective Forecast

Before getting down to analyzing why Euro reminds of a mafia victim in cement shoes falling off a Chicago bridge, allow us to open it up with a meme joke that best describes this whole ordeal...

30 Nov 2022

Why is western media so positive about the Chinese stock market?
Why is western media so positive about the Chinese stock market?

Premium news sites in the US and Europe are now saying that everything is suddenly going right for China’s stock market. Headlines announced Hong Kong stocks...

28 Nov 2022

Markets quiet down on Black Friday
Markets quiet down on Black Friday

The trading action in financial markets remains subdued amid thin volumes on Black Friday. Following the Thanksgiving Day holiday, bond and stock markets will close early...

25 Nov 2022

Football Stocks Scoring This World Cup
Football Stocks Scoring This World Cup

The 22nd education of the FIFA World Cup is scheduled to take place this year in Qatar from 20 November to 18 December 2022. This marks the first-ever World Cup held in an Arab nation and the second...

22 Nov 2022

Is GOOGL breaking out?
Is GOOGL breaking out?

After a long and bearish year for Alphabet Inc, the GOOGL chart shows a possible reversal. Is it just a brief resistance along the downward trend, or is there something...

21 Nov 2022

The impact of football on the stock market
The impact of football on the stock market

Football is one of the most popular sports worldwide, and has won the hearts of millions. The game brings together people from different walks of life, impacting not only the emotions and hearts of fans...

17 Nov 2022


Editors' Picks

FXCM information and reviews
FXCM
87%
ActivTrades information and reviews
ActivTrades
86%
RoboForex information and reviews
RoboForex
85%
MultiBank Group information and reviews
MultiBank Group
84%
FxPro information and reviews
FxPro
83%
Vantage information and reviews
Vantage
83%

© 2006-2022 Forex-Ratings.com

The usage of this website constitutes acceptance of the following legal information.
Any contracts of financial instruments offered to conclude bear high risks and may result in the full loss of the deposited funds. Prior to making transactions one should get acquainted with the risks to which they relate. All the information featured on the website (reviews, brokers' news, comments, analysis, quotes, forecasts or other information materials provided by Forex Ratings, as well as information provided by the partners), including graphical information about the forex companies, brokers and dealing desks, is intended solely for informational purposes, is not a means of advertising them, and doesn't imply direct instructions for investing. Forex Ratings shall not be liable for any loss, including unlimited loss of funds, which may arise directly or indirectly from the usage of this information. The editorial staff of the website does not bear any responsibility whatsoever for the content of the comments or reviews made by the site users about the forex companies. The entire responsibility for the contents rests with the commentators. Reprint of the materials is available only with the permission of the editorial staff.
We use cookies to improve your experience and to make your stay with us more comfortable. By using Forex-Ratings.com website you agree to the cookies policy.