Gold Prices Rise Post CPL, Will XAU/USD Go Higher!

1. Gold Prices Rise Post CPI, Will
XAU/USD Go Higher?

2. Points To Be Discussed Today:
• Gold & US Dollar Rising In Tandem
• Weakness In XAU Being US Dollar Strength
• Gold Price - Technical Outlook
• Gold Price Chart - Technical Outlook
• XAU/USD Pullback Points To A Fresh Upswing
Towards $1,900?
• Gold Price Action
• Gold Fundamental Overview

3. Gold & US Dollar Rising In Tandem
• Gold and the US Dollar have been rising in
tandem for a short while after a much higher
than expected US CPI print last week put a rocket
under Treasury yields.
• This inflationary scare helped the precious metal
re-align as a potential hedge against rising prices.
• This alliance with the ‘big dollar’ changed
overnight.
• As USD moved to make another fresh high for the
year, gold got dusted and went lower.

4. US Treasury Yields At The Back-End
• US Treasury yields at the back-end moved up
with 10 and 30-year rates rising, while the
front of the curve saw 2 and 5 years unable to
make a new high.
• This could suggest that the rise in yields in this
episode is less focused on short-term inflation,
but term risk, as the economy recovers further
down the track from the pandemic.

5. US Treasury Yields At The Back-End - I
• This rise in longer term yields was after
comments from after Federal Reserve Bank of
St. Louis President, James Bullard, said that
Fed speed up the taper process in response to
inflation.
• Strong retail sales numbers in the US also
boosted yields and the outlook in general for
the US economy, to the benefit of USD.

6. Weakness In XAU Being US Dollar
Strength
• Other base metals also moved lower in these last few
sessions, particularly aluminium and copper.
• This hints toward the weakness in XAU being US Dollar
strength related, rather an issue with the gold itself.
• With this in mind, US Dollar direction could be the key
for the next move in gold.
• There is quite a lot of US data due out for the rest of
the week.
• However, comments from Fed officials might play a
bigger role due to implications for US yields, especially
if something unexpected is said.

7. Gold Technical Analysis
• The broad range of 1676.91 – 1916.53, in play
since earlier in the year, might provide
support and resistance respectively.
• The recent break above 1834.14 might open
up a new, narrower trading range for gold.
• 1834.14, now a pivot point, might be support
and 1916.53 the potential resistance.

8. Gold Technical Analysis - I
• November 4th saw a Golden Cross occur when the
short-term 10-day simple moving average
(SMA)crossed above the long-term 200-day SMA.
• A second Golden Cross unfolded yesterday when the
medium-term 34-day SMA also crossed above the 200-
day SMA.
• This may signal bullishness momentum.
• Near term resistance could be at the recent high of
1877.15.
• On the downside, there are pivot points at 1834.14 and
1813.94 then prior lows at 1758.93 and 1721.71 that
are possible support levels.

9. CFDs On GOld

10. Gold Price - Technical Outlook
• Gold has managed to find strong bids at $1,850, now
heading back towards the recent strong resistance at
$1,870.
• If the recovery momentum sustains above the latter,
then the June 14 tops of $1,878 will get tested once
again.
• The next relevant upside target is then seen at the
$1,900 psychological level.
• The 14-day Relative Strength Index (RSI) has stalled its
descent and now edges higher while holding above the
midline. The leading indicator, therefore, suggests that
a fresh upswing could be in the making.

11. Gold Price - Technical Outlook - I
• The 100-Daily Moving Average (DMA) has pierced
through the 200-DMA from below, representing a
bull cross, adding credence to the renewed
optimism.
• However, should gold bears fight back control the
price could breach the $1,850 demand area,
below which the November 11 lows of $1,843
could be back in play.
• Further south, the previous critical resistance
now support at $1,834 will be the level to beat
for gold bears.

12. Gold Price Chart - Technical Outlook

13. XAU/USD Pullback Points To A Fresh
Upswing Towards $1,900?
• Gold price eyes another run towards $1,900,
as bulls refuse to give up yet
• The US dollar holds higher ground but yields
seem to lack follow-through.
• Bull cross confirmation on daily sticks points
to a fresh uptrend in the making.

14. Treasury Yields Helped Gold To Shine
• Gold price enjoyed good two-way price action on
Tuesday, although posted losses so far this week.
• Gold price initially rose as high as $1,877, a fresh
five-month top, as persistent inflation concerns
continued to underpin the metal’s appeal as an
inflation hedge.
• Further, a pullback in the Treasury yields also
helped gold to shine in the first half of the day.

15. The US Retail Sales Release
• The tide, however, turned in favor of bears on
the US Retail Sales release, as an upbeat data
bolstered the Fed’s rate hike expectations,
pushing up the US dollar alongside the yields.
• The 10-year benchmark yields hit the highest
levels in three-week at 1.64% while the
US dollar index tested the 96.00 level.

16. The US Retail Sales Rose
• The US Retail Sales rose for the third straight
month in October, arriving at 1.7% MoM vs.
1.4% expected.
• The upbeat mood on Wall Street indices also
exerted additional downward pressure on gold
price.

17. The US Treasury Yields Fail To Hold
• As the dust settles over the US Retail Sales-led
volatility, gold price is looking to find its feet, the
US Treasury yields fail to hold the higher ground
amid the risk-off market mood.
• The renewed weakness in the yields is capping
the US dollar rally to fresh 16-month highs,
keeping gold price afloat above $1,850.
• US-Sino trade concerns and China Evergrande
default risks resurface, weighing on the risk
sentiment, lending support to the safe-haven
gold.

18. Gold Price Action
• Looking ahead, the UK and Eurozone inflation
data will be closely eyed amid looming fears
over rising price pressures and expectations of
global monetary policy tightening.
• The Fed speculation will also lead the
sentiment and could have a strong impact on
the dollar valuations, in turn, influencing gold
price action.

19. Gold Fundamental Overview
• Gold price enjoyed good two-way price action on Tuesday, although
posted losses so far this week.
• Gold price initially rose as high as $1,877, a fresh five-month top, as
persistent inflation concerns continued to underpin the metal’s
appeal as an inflation hedge.
• Further, a pullback in the Treasury yields also helped gold to shine
in the first half of the day.
• The tide, however, turned in favor of bears on the US Retail Sales
release, as an upbeat data bolstered the Fed’s rate hike
expectations, pushing up the US dollar alongside the yields.
• The 10-year benchmark yields hit the highest levels in three-week
at 1.64% while the US dollar index tested the 96.00 level.

20. Gold Prices Rise Post CPI, Will
XAU/USD Go Higher?

21. Thanks for listening
Gold Prices Rise Post CPI, Will XAU/USD Go
Higher?