On Wednesday (April 17), the price of gold declined somewhat, and spot gold fell 0.2% to $2,376.39 an ounce. The pressure caused by the weakening hopes for US interest rate cuts overshadowed the boost from safe-haven demand caused by geopolitical turmoil in the Middle East. Although the price of gold remained near the record high set last week on Wednesday, it is clear that there are signs of an adjustment decline starting from a high point.
Source: Yi Huitong
Recently, the conflict between Israel and Iran does not seem to have further escalated on a large scale for the time being, causing both the safe-haven asset dollar and gold overnight markets to adjust and fall. Also, including Federal Reserve Chairman Jerome? On Tuesday, senior US central bank officials, including Powell, gave up providing any guidance on when to cut interest rates, but instead indicated that monetary policy needed to be limited for a longer period of time, which also slightly curbed the excessive fanatical sentiment of gold bulls. After a series of surprisingly high inflation, Powell hinted on April 16 that the Federal Reserve would wait longer than previously expected before cutting interest rates, marking another significant shift since he turned his focus to policy easing in December last year. For central bankers who gathered in Washington for the spring meetings of the International Monetary Fund (IMF) and World Bank, Powell's latest policy shift has left them in a dilemma. If the ECB, the Bank of England, and the Reserve Bank of Australia ignore the US and begin to relax their policies on their own, it may cause the local currency to depreciate, push up import prices, and disrupt the process of reducing inflation. Failure to relax, however, could jeopardize economic growth. As a result, there is still great uncertainty about when the world's major economies will cut interest rates. Just as the Federal Reserve Chairman's view on cutting interest rates changed, the US 2-year yield rose to 5% this week. Although gold is basically unrelated to the dollar and treasury yield in the current trend, it may still respond in the short term to the trend of both.
On a technical level, on the short-term 4-hour chart, there was a triple peak pattern. The k line reached around 2,400 three times, and all were blocked. Overnight gold once again verified that 2400 resistance was effective, and there was a bearish swallowing pattern. The two large negative lines directly covered the amplitude of the positive line. The k line began to exert strength above the moving average, directly breaking through the moving average. The gold price also began to fall below the middle line of the Bollinger band channel. Various technical indicators in the short term showed an increased risk of an adjustment fall in the short term. The primary support level below is still around 2357, followed by 2323. If the latter level also falls, gold may face phased retracement adjustments. If short-term adjustments are made, the price of gold can be held above the 2,323 level, then it can be expected that the market will continue to rise in the future.
Bank of China Guangdong Branch Wang Gang
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