Gold Rises as US Economic Indicators Fall Short of Expectations【July 4, 2024】

Fundamental Analysis

• US economic indicators fell short of expectations, raising expectations for a US rate cut.
• The probability of a rate cut in September is increasing.
• US President Biden is considering withdrawing, under pressure from within the Democratic Party.

XAUUSD technical analysis

Analyzing the daily chart for gold: It broke out of the downtrend line and surpassed the 28, 52, and 72-day moving averages, reaching new highs. The recent high is around 2368 USD. After bouncing off the neckline at 2280 USD and showing some indecision, the growing expectations for a US rate cut seem to have triggered dip-buying.

Be cautious as there may be sudden changes due to today’s UK general election and this weekend’s French election results. The anticipated resistance levels are 2368 USD and 2379 USD.

Day trading strategy (1 hour)

Analyzing the 1-hour chart: The trend was in a consolidation phase for a while, but it broke out upwards during yesterday’s overseas session. The RSI hit 70, showing a slight pullback.

Today’s US stock market is closed, so trading volume may be thin. Additionally, with the UK general election, the market may react sensitively. As a strategy, it’s advisable to wait and see. If expectations for a rate cut rise, it might be worth buying if the price drops below 2300 USD.

Support/Resistance lines

Here are the support and resistance levels to consider going forward:

2379 USD – Major resistance line 2368 USD – Previous high

Market Sentiment

XAUUSD: Sell: 63%, Buy: 37%

Featured Currency Pair of the Week (NZDJPY)

The New Zealand Dollar to Japanese Yen (NZDJPY) continues to rise. The 28, 52, and 72-day moving averages are widening, indicating a strong upward trend. Notably, the RSI is at 70.5, reaching an overbought level. Before it drops, there might be a rapid surge followed by a sharp decline. Be cautious of the movements.

Today’s important economic indicators

*Trading advice in this article is not provided by Milton Markets, but by Shu Fujiyasu Jr., a certified technical analyst.