On Monday (April 29), although the Japanese authorities interfered in the foreign exchange market on Monday and caused the dollar to fall, the gold reaction was calm. The closing price of gold was basically the same as Friday, closing at 2334.43 US dollars. Currently, the market's focus is on important events such as the Federal Reserve's policy meeting and the US non-farm payrolls data to be released this week to find clues about the Fed's interest rate trajectory.
Source: Yi Huitong
Although it was reported on Monday that the Bank of Japan's implementation of market intervention led to a slight decline in the dollar index, the impact on gold appears to be limited. Gold market participants are basically focused on waiting for the Federal Reserve's interest rate meeting on Wednesday and the non-farm payrolls report on Friday, hoping to get a glimpse into the Fed's interest rate trend. Consumer inflation data for March released earlier this month was higher than expected, and it has begun to push traders to lower their expectations for the Federal Reserve to cut interest rates. The Federal Reserve's two-day policy meeting will begin on April 30. According to CME's FedWatch federal observation tool, the Federal Reserve is expected to keep the target range of 5.25% to 5.5% unchanged at the end of Wednesday's meeting. Given signs that inflation continues to rise and economic growth is resilient, the Federal Reserve should be in no hurry to cut interest rates. The market should have fully absorbed this view ahead of time. The key point now is whether the Federal Reserve took a hawkish stance on interest rate cuts or further hinted at postponing interest rate cuts at the May meeting, or whether it showed concern about economic growth, and revealed a dovish attitude. Furthermore, the strength of the non-agricultural sector on Friday, especially wage growth, will be a key influencing factor disrupting the gold trend.
On a technical level, the price of gold is currently hovering above the pivot point of $2325.66. The initial resistance level is $2370.56, and further resistance is the $2,400 integer mark. If it falls below the pivot point, it may experience initial support at $2290.40, followed by $2248.71 and $2212.49. The current trend of technical indicators on the daily chart does not seem to be favorable to gold. They all show a downward trend, indicating that gold may still face pressure to adjust and fall further. The key now is to keep an eye on the impact of some of the important events mentioned above from the US this week.
Bank of China Guangdong Branch Wang Gang
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