Focus on Gold Price: XAU/USD Chart and Analysis
Gold prices have decreased as a result of the recent increase in interest rate-sensitive US Treasury 2-year rates, as expectations for higher yields continue to climb. The most recent US Jobs Report, which revealed a healthy economy, has also contributed to rising yields.
Effect of Jerome Powell’s speech as Fed Chair
Fed chairman Jerome Powell will speak at The Economic Club of Washington at 17:40 GMT today. Since the publication of the US Jobs Report, which spiked Treasury rates, this is his first appearance in public. The markets are now pricing in a 25 basis point rate increase for the FOMC meeting in March, with a further increase in May being anticipated. As he continues to concentrate on getting inflation back to goal, Powell is anticipated to highlight the resilience of the US economy and cite the Jobs Report as support.
The State of the Union Address by President Biden
US Vice President Joe Biden will give his second State of the Union speech tonight at 2100EST/0200GMT from the White House. He is anticipated to emphasize how well the economy is doing under Democratic Party control and use the present low unemployment rate as evidence of their competence.
Price Technical Analysis of Gold
Resistance for gold prices is around $1,878/oz, while support can be found at $1,850/oz, which is the 50-day moving average.
The View from Small-Time Traders on Gold
According to statistics from retail traders, there are presently 67.39% of traders who are net-long, with a long-to-short ratio of 2.07 to 1. The number of traders that are net-long has climbed by 17.98% from the previous week and by 5.67% from yesterday. The number of net-short traders has also climbed from yesterday, up 4.01%, but has declined from last week, down 27.89%.
Contrary to common belief, traders’ net long positions point to a potential decrease in gold prices. The present perspective for gold is more pessimistic, and recent adjustments in trading holdings support this conclusion.