Ichimoku Analysis (4- Hour chart)
Tenken-Sen- $1977.57
Kijun-Sen- $1965.59
Gold prices are consolidating after hitting a fresh two-month high. The yellow metal surged over $70 from a low of $1912 on weak US inflation data. Fed is expected to be less hawkish due to invalid US economic data. It hits a high of $1987.53 and currently trading around $1984.76.
US housing starts declined by 8% to a seasonally adjusted annual rate of 143000 and building permits fell 3.7% to 1.44M.
Major economic data for the day
Jul 20th, 2023, US Initial jobless claims (12:30 GMT)
Philly fed manufacturing index
US dollar index- weak. Minor support around 99.50/98. The near-term resistance is 100.60/102.
According to the CME Fed watch tool, the probability of a 25 bpbs rate hike in July increased to 99.80% from 93% a week ago.
The US 10-year yield is trading weak on weak US housing data. The US 10 and 2-year spread narrowed to -101% from -110%.
Factors to watch for gold price action-
Global stock market- bullish (negative for gold)
US dollar index - Bearish (Positive for gold)
US10-year bond yield- Bearish (positive for gold)
Technical:
The near–term support is around $1950, a break below targets of $1945/1930. The yellow metal faces minor resistance around $1965, and a breach above will take it to the next level of $1980/$2000.
It is good to buy on dips around $1960 with SL around $1950 for TP of $1990/$2000.
