Markets Analysis

Gold breaks below trendline, direction to be determined by US CPI?【August 10, 2023】

August 10, 2023

Markets Analysis

Fundamental Analysis

  • U.S. stock indexes continue to fall, anomaly for August sell-off in the summer market
  • Italy partially reverses policy of taxing banks, stock market turmoil subsides
  • Focus on U.S. consumer price index, will inflation slow down?

XAUUSD Technical Analysis

Analysis of the daily gold chart confirms a clear breakout of the downtrend line. Although nervous ahead of the release of the U.S. CPI, the technicals continue to be lower. The daily target is the recent low of USD 1,892.

A descending channel can be drawn, and if the price breaks below the recent low and a downtrend occurs, a stop loss can be expected to be rolled in. The RSI is at 41, indicating that there is ample room for a decline.

The development will depend on today’s U.S. CPI, so we await the announcement.

[XAUUSD / D1]

Day Trading Strategy (Hourly)

The day trade policy is to return to the market. the RSI shows a break above 30 from below. The price is hovering near the lows, so a certain amount of rebound can be expected. The guideline for a rebound is around the middle line of the Bollinger Band at USD 1,920.

Looking at market sentiment, we can expect a very large level of buy positions and a large number of orders. This means that a sharp drop could gain momentum, involving a large number of stop-loss orders.

We do not want to hold positions before the release of the U.S. CPI, but if the market turns out to be in a downward direction after the CPI is released, we plan to follow the market honestly.

Support and Resistance Lines

The resistance line to be considered in the future is as follows

1907 USD – Major support line
1892 USD – The latest daily low

[XAUUSD / H1]

Market Sentiment

XAUUSD Sell: 19% Buy: 81%

Today’s Important Economic Indicators

Economic Indicators and EventsJST (Japan Standard Time)
U.S. Consumer Price Index21:30
U.S. Unemployment Insurance Claims21:30

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

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