FxWirePro- Gold Daily Outlook

Ichimoku Analysis (4-hour chart)

Tenken-Sen- $1700.60

Kijun-Sen- $1702.45

Gold price recovered above $1700 after hitting a low of $1682 on strong Euro. The European central bank hiked its rates by 50 basis points to 0.0%, the first hike in 11 years. It also promised further rate hikes in its next policy meeting.  The yellow metal rebounded after an aggressive rate hike by ECB. US dollar index pared some of its losses made yesterday on short covering.   According to the CME Fed watch tool, the probability of a 100 bpbs rate hike in Jul dropped to 29.7% from 44.6% a day ago.

The number of people who have filed for unemployment benefits rose by 7000 last week to 251000 compared to a forecast of 240K. US Philly fed manufacturing contracted for a second consecutive month to -12.3 in Jul.

Factors to watch for gold price action-

Global stock market- Bullish (negative for gold)

US dollar index – Mixed (Neutral for gold)

US10-year bond yield- Mixed (neutral for gold)

Technical:

The near–term support is around $1680, a breach below targets $1650/$1600. Significant reversal only below $1600. The yellow metal faces minor resistance around $1720, breach above will take it to the next level of $1732/$1745/$1770.

It is good to sell on rallies around $1720-21 with SL around $1750 for TP of $1650/$1600.