Senior Economic & Technical Adviser
WHAT IS THE NEXT FOR GOLD AFTER CPI?
The inflation data (consumer price index) is a vital piece of information since it directly influences the decisions of the U.S. Federal Reserve with respect to the economy.
Inflation surged to 8.3% for the month of April, marking a significant rise from the previous year, looming close to 40-year highs.
The Federal Reserve has rolled out several measures to counter soaring inflation, having instituted two interest rate hikes so far this year, and is also prepared to implement additional rate increases to bring inflation levels down to the central bank’s target of 2%. However, Wednesday’s CPI report shows that the Fed still has a long way to go achieve its goals.
After the bullion achieved a yearly high in early March, the XAU/USD has been observed to make a few strong impulses down on the daily and weekly charts.
Gold prices are currently testing the pivotal resistance of 1850.00, which requires consideration from the upcoming trade, as breaching this level will stop the negative scenario for today and push the price to shift to the upside in 1871 and then 1906, while the price needs to consolidate below the mentioned resistance mark to continue the bearish trend that targets the 1820.00 and 1780.00 levels as stations.