Days are Numbered for Gold

Days are Numbered for Gold

2023-02-07 • Updated

Gold is one of the most popular trading assets in the world, with a several age history and an unbelievably large market capitalization of $11 trillion. There are 100 ounces of gold in 1 lot, and it is a $1.8 million order size. Therefore, if you want to control your trades in the FBS trader application or Meta Trader 4/5, you can trade as little as 0.01 lot of gold (which is only 1 ounce of the metal). This article will guide you through the possible outcomes for the current gold movement after the US reveals their economic data and clarifies the amount of future rates hikes. So get yourself comfortable, and let’s start!

What moves the gold?

Gold had dozens of fruitful movements in both 2020 and 2021. When the world thought the economy was about to recover, our shiny friend lost 19% of its capitalization in several months. But then, another coronavirus strain emerged. So it doesn’t matter whether you are a bull or a bear trader; gold movements in 2021 gave opportunities to everyone, with 13% surges and 11% plunges.

Next week we will have a couple of events that will affect the gold price. The first is the US core retail sales on February 16, 15:30 GMT+2. It shows a change in the total sales value at the retail level, excluding automobiles. High numbers mean economic strength. Thus, gold might slide lower after the release. The second is FOMC meeting minutes, where we will get more information on rate hikes and monetary tightening. The record will be available on February 16, 21:00 GMT+2. Hawkish tones from the Fed members will press on the gold. You can get the data first in FBS economic calendar; it is fast, convenient, and easy to use.

Forecast for gold

Expectations of rate hikes, inflation concerns, and coronavirus pressure the gold price. The market is about to decide the fate of the metal for 2022. As far as we know, this year, five rate hikes are expected to fight inflation both in the US and in other countries. Due to relatively slow economic recovery, money flows not to the gold but to even more defensive assets, like the Japanese Yen and Swiss Franc. We expect that if the inflation stops at current levels (7-8%), XAU/USD will struggle to rise and may slide down to 2020 levels ($1700-1600).

As for February, gold may reach the upper border of the descending trendline at $1855, and it is the perfect opportunity to wait for a reversal or a breakout of this level. (Enter the trade only after the confirmation from the chart).

XAU/USD daily chart

Resistance: 1850; 1870

Support: 1790; 1765; 1725

XAUUSDDaily.png

On the bigger timeframe, gold is moving sideways in the symmetrical triangle. Triangles are tricky price formations as they often work poorly. The best way to predict the future price movement is to wait for a breakout and then trade in the breakout direction. Apart from technical indicators, we think gold will be weak for the next several months due to rates hikes and economic recovery. We expect the metal to reach $1725 and $1685 levels in the 2-3 months. To learn more about technical analysis and get trade ideas daily, visit the FBS website; we post our daily thoughts on the market and are sure you’ll find them helpful.

XAU/USD weekly chart

Resistance: 1870; 1915

Support: 1765; 1725; 1685

XAUUSDWeekly.png

You can trade XAU/USD contract for difference with FBS. It doesn’t matter whether you are buying or selling; you have the same sweet conditions for all your trading desires. And the best time to open a trade is now. Good luck!

Similar

Latest news

USD: Powell Speaks on Cutting Interest Rates
USD: Powell Speaks on Cutting Interest Rates

Jerome H. Powell, the Federal Reserve chair, stated that the central bank can afford to be patient in deciding when to cut interest rates, citing easing inflation and stable economic growth. Powell emphasized the Fed's independence from political influences, particularly relevant as the election season nears. The Fed had raised interest rates to 5.3 ...

WTT: Currency Pairs To Trade In April
WTT: Currency Pairs To Trade In April

Hello again my friends, it’s time for another episode of “What to Trade,” this time, for the month of April. As usual, I present to you some of my most anticipated trade ideas for the month of April, according to my technical analysis style. I therefore encourage you to do your due diligence, as always, and manage your risks appropriately.

Deposit with your local payment systems

Data collection notice

FBS maintains a record of your data to run this website. By pressing the “Accept” button, you agree to our Privacy policy.

Callback

 1
 93
 355
 213
 1684
 376
 244
 1264
 672
 1268
 54
 374
 297
 61
 43
 994
 1242
 973
 880
 1246
 375
 32
 501
 229
 1441
 975
 591
 387
 267
 55
 246
 673
 359
 226
 257
 855
 237
 1
 238
 1345
 236
 235
 56
 86
 61
 61
 57
 269
 242
 243
 682
 506
 225
 385
 53
 357
 420
 45
 253
 1767
 1809
 593
 20
 503
 240
 291
 372
 251
 500
 298
 679
 358
 33
 594
 689
 241
 220
 995
 49
 233
 350
 30
 299
 1473
 590
 1671
 502
 224
 245
 592
 509
 39
 504
 852
 36
 354
 91
 62
 98
 964
 353
 44
 972
 39
 1876
 81
 962
 7
 254
 686
 850
 82
 965
 996
 856
 371
 961
 266
 231
 218
 423
 370
 352
 853
 389
 261
 265
 60
 960
 223
 356
 692
 596
 222
 230
 262
 52
 691
 373
 377
 976
 382
 1664
 212
 258
 95
 264
 674
 977
 31
 599
 687
 64
 505
 227
 234
 683
 672
 1670
 47
 968
 92
 680
 970
 507
 675
 595
 51
 63
 64
 48
 351
 1787
 974
 262
 40
 7
 250
 590
 290
 1869
 1758
 590
 508
 1784
 685
 378
 239
 966
 221
 381
 248
 232
 65
 421
 386
 677
 252
 27
 500
 34
 94
 249
 597
 268
 46
 41
 963
 886
 992
 255
 66
 670
 228
 690
 676
 1868
 216
 90
 993
 1649
 688
 256
 380
 971
 44
 1
 1
 598
 998
 678
 58
 84
 1284
 1
 681
 2
 967
 260
 263
00:00
00:00
00:00
01:00
02:00
03:00
04:00
05:00
06:00
07:00
08:00
09:00
10:00
11:00
12:00
13:00
14:00
15:00
16:00
17:00
18:00
19:00
20:00
21:00
22:00
23:00
23:00
23:00
00:00
01:00
02:00
03:00
04:00
05:00
06:00
07:00
08:00
09:00
10:00
11:00
12:00
13:00
14:00
15:00
16:00
17:00
18:00
19:00
20:00
21:00
22:00
23:00

A manager will call you shortly.

Change number

Your request is accepted.

A manager will call you shortly.

Next callback request for this phone number
will be available in

If you have an urgent issue please contact us via
Live chat

Internal error. Please try again later

Don’t waste your time – keep track of how NFP affects the US dollar and profit!

You are using an older version of your browser.

Update it to the latest version or try another one for a safer, more comfortable and productive trading experience.

Safari Chrome Firefox Opera