On Wednesday (June 5), spot gold maintained its intraday rebound trend, with the gold price currently located around $2,339 per ounce.
Gold prices remained strong despite the dollar maintaining its gains. Analysts say tensions in the Middle East have given gold a boost.
Gold prices rebounded ahead of key U.S. data, a day after testing a three-week low of $2,315 an ounce.
The question is whether gold’s rally will continue.
The question is whether gold’s rally will continue.
Spot gold closed down $23.61, or 1%, on Tuesday at $2,326.66 per ounce. Gold prices fell to an intraday low of $2,315.56 per ounce.
Investors are currently turning their attention to top-level data (U.S. ISM services PMI data) to find new clues on the Fed’s interest rate outlook, which may have a significant impact on gold prices.
At 22:00 Hong Kong time on Wednesday, the U.S. ISM non-manufacturing purchasing managers’ index (PMI) for May will be released and is expected to be 50.8.
If U.S. ISM services PMI data later on Wednesday disappoints markets, renewed dovish Fed expectations could continue to weaken the dollar and revive bullish sentiment around gold prices.
Gold price technical trend analysis
As you can see on the daily chart, gold prices closed below the key 50-day simple moving average (then $2,335 an ounce) on Tuesday, breaking out of range.
The 14-day relative strength index (RSI) has returned to negative territory below 50, justifying a downside breakout.
On the downside, gold sellers will need to keep gold prices below the three-week low of $2,315 per ounce to extend the downward trend towards the $2,300 per ounce level.
Looking further down, gold prices may fall towards the May 3 low of $2,277 per ounce.
On the upside, gold needs to break above the 50-day moving average resistance (currently at $2,337/oz) to further challenge the 21-day moving average at $2,358/oz.
If gold prices break above the above-mentioned moving average resistance, gold buyers may push towards the May 24 high of $2,364 per ounce. Once this level is overcome, gold prices are expected to move toward the lower edge of the wedge at $2,400 per ounce.
Author: Zhou Tong (analyst) 05-06-2024
At 20:50 Hong Kong time, spot gold was trading at US$2,340.06 per ounce.
#The above are only the author’s personal opinions and have nothing to do with the company’s position.
Warm reminder from Hongfeng Gold: The strategic suggestions are for reference only. There are risks in entering the market, so investment needs to be cautious.