1. Technical Analysis:
Heavy Zone and Resistance:
The price is in a heavy zone with a strong struggle continue the resistance zone has not yet been tested.
Anticipation of a decline from the resistance zone towards the breakdown of the uptrend goal and Support Level:
The goal is set at the support level of 1802.35.
2. Fundamental Factors:
2.1 Market Conditions and Recent Events:
Gold has been sold heavily following less hawkish remarks from Fed officials, weaker jobs data, and a slide in ISM services.
Risk appetite returning to global markets, leading to a decline in the US Dollar below 95.300 DXY.
2.2 Fed Officials’ Comments:
Fed’s Bullard sees three successive hikes to start policy tightening.
Fed’s Harker says four rate hikes are appropriate for this year.
2.3 Jobs Data Expectations:
Economists expect an increase of 150,000 jobs in January.
White House warns that the jobs data will likely be impacted by Omicron-related disruptions.
2.4 Central Bank Remarks:
ECB (European Central Bank) President Lagarde emphasizes careful assessment and data dependency.
Hawkish statements from the Bank of England and ECB led to intraday selling around gold.
2.5 Market Reaction and Reversal:
Weaker USD and a steep fall in US equity markets helped reverse the early slide in gold.
3. Support and Resistance Levels:
Resistance Levels (R):
- R1: 1800
- R2: 1814
- R3: 1829
- R4: 1846
- R5: 1862
Support Levels (S):
- S1: 1795
- S2: 1781
- S3: 1770
- S4: 1759
- S5: 1742
Conclusion:
The technical analysis indicates an expectation of a decline from the resistance zone, aligning with the goal set at the support level of 1802.35. The fundamental factors, including Fed officials’ comments, jobs data expectations, and central bank remarks, provide context to the market conditions.
Traders should closely monitor the resistance zone and the support level, taking into consideration any new information that may impact market dynamics. The central bank’s monetary policy decisions and economic data releases will likely play a crucial role in determining the future direction of gold prices. As always, risk management is essential when navigating volatile markets.
