HFM information and reviews
OctaFX information and reviews
XM information and reviews
FXCC information and reviews
FxPro information and reviews
FXCM information and reviews

XAUUSD: Weekly Review 16-20 January 2023

17 January 2023

Gold jumped to start 2023 with strong gains, as the positive momentum from December carried over into the new year. Last year’s headwinds, particularly the strengthening Dollar and Yields are starting to reverse, so 2023 is likely to be more friendly to the yellow metal. According to data released by the US Bureau of Labor Statistics, US consumer prices fell to 6.5% in December from November’s 7.1%, giving hope that the US Fed’s strategy to tame inflation is working and the US Fed will also take a softer policy in its rate hike approach. Slowing inflation means less aggressive rate hikes by the Fed. As per the CME Fed surveillance tool, the probability of a 25-bps hike at the February FOMC meeting has risen to 92.7 per cent.

Weakening Dollar, recession fears and geopolitical uncertainty could boost demand. The global economy is likely to go through tough times, as a result of cost of living crisis and slowdown in major economies. In addition, China’s economic growth, which is likely to pick up this year due to a number of easing measures, could fuel demand for the yellow metal. Following a sharp rise in central bank demand for Gold in the third quarter of 2022, the outlook for official sector demand for the yellow metal is likely to hold in 2023 as well.

Concerns over weaker global economic growth and geopolitical tensions will continue to make Gold valuable as a hedge against uncertainty. During the first three quarters of last year, the World Gold Council reported official sector purchases of 673 tonnes, higher than any full year since 1967. Added to that was a total of 62 tonnes purchased in November and December from the PBOC. Part of that demand was fuelled by a handful of central banks looking to reduce their dollar exposure. This de-dollarisation and general appetite for gold will ensure another year of official sector gold purchases that are likely to be stronger.

Technical Review

Speculative technical buying seems to be the main driver for Gold at the moment, led by continued demand from hedge funds that turned net buyers in early November, as the triple bottom signalled a change from the prevailing strategy of selling Gold at signs of strength. In the short-term, Gold looks increasingly in need of a correction with the risk underpinned by lower physical demand; while traders get used to higher prices.

XAUUSD hasn’t shown any fading rally momentum since early November, and January’s surge has seen that gap widen, but with RSI signalling overbought conditions, a correction towards the downside for price neutralisation can’t be ruled out.



Last week, XAUUSD recorded a high of 1,921.87 adding more than +5% gains since January this year. The price is seen at a resistance level seen since June 2021. Further upside is likely to test the 76.8% retracement level around 1,964.00 price along with the past resistance zones seen around November 2020 and January 2021. While on the downside, the main foothold is at 1,879.00 resistance which is now support and a strong level is seen at 1,807.78, or at least back to the January 2023 opening price around 1,825.00, in case of a strong correction.


Share: Tweet this or Share on Facebook


Analyzing the State of Dollar Dominance
Analyzing the State of Dollar Dominance

The EUR/USD pair witnessed a significant development recently, as it recorded its 2023 nadir, hovering around 1.0450. However, it didn't stay there for long...

4 Oct 2023

Gold Dips to a 7-Month Nadir, Clinging to the Precarious $1,800 Support
Gold Dips to a 7-Month Nadir, Clinging to the Precarious $1,800 Support

In an environment punctuated by the looming shadows of rising inflation and potential rate hikes, gold, the age-old sanctuary for investors, seems to be losing its glint...

3 Oct 2023

EURUSD Rebounds from 8-Month Low, Yet Downtrend Remains Formidable
EURUSD Rebounds from 8-Month Low, Yet Downtrend Remains Formidable

The EURUSD currency pair has encountered turbulent waters in recent trading sessions, with the predominant sentiment skewing bearish. Despite this, a detailed examination of its movements provides traders with insights...

3 Oct 2023

Platinum's Ascending Demand and Depleting Reserves: A Golden Opportunity for Traders
Platinum's Ascending Demand and Depleting Reserves: A Golden Opportunity for Traders

When delving into the realm of commodities, the inherent dynamics of supply and demand remain pivotal in dictating price trajectories...

29 Sep 2023

Extended Analysis: The Tumult in Soft Commodities and the Inflationary Maze
Extended Analysis: The Tumult in Soft Commodities and the Inflationary Maze

Soft commodities have inexorably stepped into the spotlight as their soaring prices amplify the labyrinth of global inflation. A spectrum of meteorological adversities and burgeoning...

28 Sep 2023

Continual Dollar Ascendancy: The Underlying Dynamics
Continual Dollar Ascendancy: The Underlying Dynamics

The trajectory of the US dollar is demonstrating an upward momentum, with the dollar index inching closer to the resistance level at 106.00...

28 Sep 2023

Editors' Picks

MultiBank Group information and reviews
MultiBank Group
Vantage information and reviews
FP Markets information and reviews
FP Markets
Just2Trade information and reviews
AMarkets information and reviews
IronFX information and reviews

© 2006-2023 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.