Ichimoku Analysis (4-hour chart)
Tenken-Sen- $1716.18
Kijun-Sen- $1716.18
Gold declined drastically after upbeat US CPI data. The US inflation for Aug dropped to 8.3% YoY Compared to a forecast of 8.1%. Core CPI surged 0.6% over the month, to an annual rate of 6.3%. The overall trend is still bullish as long as support of $1680 holds.
According to the CME Fed watch tool, the probability of a 100 bpbs rate hike in Sep rose to 35% from 0% a day ago.
Factors to watch for gold price action-
Global stock market- Bearish (positive for gold)
US dollar index – Bullish (negative for gold)
US10-year bond yield- Bullish (negative for gold)
Technical:
The near–term support is around $1690, a close below targets $1671/$1650/$1600. Significant reversal only below $1650. The yellow metal faces minor resistance around $1720, breach above will take it to the next level of $1740/$1760/$1775/$1800/$1820.
It is good to buy on dips around $1678-80 with SL at around $1650 for TP of $1750/$1775.
