Fundamental Analysis

• The Federal Reserve signaled an aggressive easing stance at the FOMC, deciding on a 0.50% rate cut.
• Chair Powell commented that we should not expect the same pace of rate cuts going forward.
• He made it clear that protecting jobs and the economy is a priority, raising expectations for a soft landing.

XAUUSD technical analysis

Analyzing the daily chart of gold: Gold surged to 2600 USD but reversed after Powell’s remarks, forming a “high price bearish candlestick.”

Normally, a 0.50% rate cut would be a very bullish factor for gold, but as Powell suggested a slower pace of future rate cuts, it faced selling pressure near the highs.

After forming a high price bearish candlestick, selling pressure is likely to increase. The expected downside target is around 2540 USD, which corresponds to the 38.2% Fibonacci retracement of the previous uptrend. The 52-day moving average is trending upward and is currently around 2475 USD. We should pay attention to whether the RSI bounces from the 50 level.

Day trading strategy (1 hour)

Analyzing the 1-hour chart of gold: It can be confirmed that gold faced resistance at the 52-period moving average and reversed. The 200-period moving average is currently around 2542 USD, and there is a high possibility that the price will retrace to that level.

Since the 200-period moving average is likely to be a key level, a rebound is also likely.

The day trading strategy is to engage in sell scalping until gold reaches 2545 USD. Upon reaching 2545 USD and touching the 200-period moving average, I would consider buying on the dip. With the fact that a significant rate cut has been made, gold is expected to rise in the long term.

If the price clearly breaks below the 200-period moving average, the stop will be triggered. Take profit is set at 2600 USD.

Support/Resistance lines

The following support and resistance levels should be considered going forward:

2542 USD • 1-Hour Chart 200 Moving Average

2540 USD • Daily Chart Fibonacci 38.2%

Market Sentiment

XAUUSD Sell: 64% Buy: 36%

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.