XAUUSD Forecast: Gold Prices to looks for $2,700 after Wednesday’s close above $2,670
- Gold price flirts with record highs, awaiting US Retail Sales data for next push higher.
- The US Dollar retreats after rallying on a Trump victory optimism, as China worries linger.
- Gold price’s daily technical setup points to more upside, with $2,700 in sight.
On Thursday, the gold price is currently consolidating gains near record highs in Asian trading, trading in the green for the third day in a succession. The US Retail Sales data is currently the primary focus of gold purchasers in anticipation of the next upward movement.
The gold price is anticipating the release of US data, as China’s stimulus has failed to meet expectations
Even as China’s property market support measures disappoint, the gold price is benefiting from a renewed decline in the US Dollar (USD) on a global scale. Beijing will “increase the credit scale of white-list projects to four trillion” yuan by the end of the year and assist in the renovation of one million homes, according to China’s Housing Minister.
Nevertheless, the most recent measures taken by China to support the struggling sector were insufficient to captivate local equities, as the main Chinese benchmark indices experienced a decline in their initial gains. Moreover, the dragon nation is the world’s largest consumer of yellow metal, which could continue to act as a deterrent to the gold price due to China’s economic difficulties.
Furthermore, the potential for an increase in the price of gold is also mitigated by a slight increase in the yields on US Treasury bonds. At the same time, markets are engaging in profit-taking on their USD long positions in anticipation of the high-impact economic data release of the week, the US Retail Sales report.
The US Dollar’s recovery rally continued into Wednesday, as there are growing expectations that Republican nominee Donald Trump will win the US presidential race. The November 5 elections are still a few weeks away.
The ongoing US Dollar advance has been significantly influenced by the recent shift in focus to the US elections, as Trump’s fiscal and trade policies are perceived as inflationary and beneficial for the Greenback.
Subsequently, the US Federal Reserve (Fed) has reached an agreement to reduce interest rates by 25 basis points (bps) in November. Consequently, it is improbable that the US Retail Sales data will alter these expectations. Nevertheless, the market’s pricing of an additional rate reduction in December may be affected.
Nevertheless, the Gold price action will continue to be influenced by risk trends, US macro news, Fedspeak, and Trump optimism.
