Ichimoku Analysis (Weekly chart)
Tenken-Sen- $1834.50
Kijun-Sen- $1776.28
Gold consolidating in a narrow range after a massive three-week rally. The weak economic data and political risks support yellow metal at lower prices. Gold hits a high low of $1937 and is currently trading around $1928.92.
Last month, the US Producer price index declined 0.50%, below the estimate of 0.10%. The YoY PPI came at 6.2% vs. an estimate of 6.8%. US retail sales came at -1.1% last month, the biggest drop since Dec 2021.
The number of people who have filed for unemployment benefits dropped by 15000 to 190K in the week ended Jan 14th, the lowest level since Sep. US Philly Fed manufacturing improves to -8.9 in Jan vs. -11 expected.
US dollar index- Bearish. Minor support around 101.50/100. The near-term resistance is 103.50/104.50.
According to the CME Fed watch tool, the probability of a 25 bpbs rate hike in Feb rose to 99.8% from 93.70% a week ago.
The US 10-year yield gained after hitting a low of 3.32%. Any break and close below 3.26% confirm minor bearishness. The yield spread between 10 and 2-year widened to -69 basis points from -46.9 bpbs.
Factors to watch for gold price action-
Global stock market- bearish (bullish for gold)
US dollar index – Bearish (positive for gold)
US10-year bond yield- Bearish (Positive for gold)
Technical:
The near–term support is around $1890, a break below targets of $1865/$1825.The yellow metal faces minor resistance around $1935, and a breach above will take it to the next level of $1950/$1969.
It is good to buy on dips around $1890 with SL around $1880 for TP of $1935/$1950.
