Gold (XAU/USD) has experienced a slight dip, settling just above $2,018 with a marginal pullback. Key indicators, including RSI and MACD, indicate a subdued buying momentum, reflecting the consolidation of December’s rally by bulls.
During Friday’s session, XAU/USD traded at $2,018, marking a modest decline of 0.08% and closing the week with a 0.55% loss. Following its peak at $2,135 in December, buyers have taken a pause, signaling a neutral to slightly bullish outlook on the daily chart. Despite some momentum in the four-hour chart, the indicators remain relatively weak.
The decline in gold prices is attributed to the USD recovery, driven by market adjustments related to the Federal Reserve’s actions amid the resilient US economy. Soft Personal Consumption Expenditures (PCE) figures from December didn’t cause a significant market reaction, and expectations for the Fed’s easing cycle have been pushed from March to May. However, the Fed’s upcoming tone may influence these expectations.
Examining XAU/USD levels, the daily chart’s technical indicators, including RSI and the metal’s position concerning the 20, 100, and 200 Simple Moving Averages (SMAs), present a mixed picture. Despite the RSI showing a negative slope and residing in negative territory, the price remains above the 20, 100, and 200-day SMAs. This suggests a bullish stance in the broader time frame, and the recent pullback could be a result of bulls taking a breather after the December push to $2,135.
On the narrower four-hour chart, momentum indicators reveal weak yet existing bullish undertones. The four-hour RSI exhibits a negative slope but is currently in positive territory, while the four-hour Moving Average Convergence Divergence (MACD) produces flat red bars, indicating a hold on bearish momentum.