On Thursday, August 13, international gold prices faced profit-taking due to technical resistance from trendline pressures. Hawkish remarks from Fed officials Hammack and Barkin reinforced this pullback, wiping out Wednesday's gains. This suggests short-term pressure for further adjustments. Unless prices break and hold above the 200-day moving average, the near-term bias remains bearish, targeting a dip to the daily Bollinger Band middle line or the upward trendline support before a renewed bullish view.
In terms of specific movements, gold opened at $4,410.04 per ounce in the Asian session, initially strengthening to a daily high of $4,449.53 before encountering resistance and falling. During the European session, it hit a low near $4,364, but a rebound followed. However, the U.S. session saw renewed selling pressure above $4,400, leading to another decline. The price ultimately recorded a daily low of $4,343.71 and closed at $4,351.00. The daily range was $105.82, with a loss of $59.04, or 1.34%.
Where to focus today
Looking ahead to Friday, August 14, international gold opened with a narrow trading range. Downward pressure from technical resistance and hawkish comments from Fed officials weighed on the metal. However, the U.S. July Producer Price Index (PPI) came in below expectations, indicating that the inflationary pressure from the recent oil price surge is easing. Bond traders are no longer fully pricing in a Fed rate hike this year, which could limit gold's downside and strengthen its bullish outlook. Geopolitically, Iran's claim of full control over the Strait of Hormuz and its threat to escalate conflict if conditions are not met, combined with the U.S. military maintaining a blockade and deploying the USS Washington to the Middle East, continue to fuel concerns over oil prices and inflation. Meanwhile, hawkish Fed comments cap gold's upside potential.
In summary, gold faces short-term adjustment needs, but the medium-to-long-term outlook remains bullish. Key data to watch today include the U.S. July retail sales, the August preliminary 1-year inflation rate expectation, the June business inventories, and the August University of Michigan consumer sentiment index, which are generally expected to support gold prices. Consequently, the intraday bias leans toward a bullish bounce from lows, but with resistance overhead, a "buy first, sell later" strategy is recommended for Friday.
Technical analysis and outlook
On the weekly chart, gold staged a strong rally last week, as expected, rebounding from the upward trendline support after a period of consolidation. It is now trading above the 5- and 10-week moving averages, as well as the 60-week moving average resistance. The MACD histogram's bearish signal is weakening, while the KDJ has formed a bullish crossover, suggesting the potential for a sustained rally toward $4,500 or $4,700. The price has now encountered resistance at the trendline pressure, with further resistance at the 30-week moving average. If it breaks and holds above the trendline, the bullish bias should be followed. If it fails to break higher, the 60-week and even 100-week moving averages offer long-term buying opportunities.
On the daily chart, gold has been consolidating around the upward trendline support before rallying. It has now hit the downward trend channel resistance, showing repeated signs of failure. However, the overall pattern with the upward trendline indicates a bullish breakout triangle. Therefore, any pullback to the trendline support would be a buying opportunity. Conversely, a break above $4,600 would signal a complete reversal of bearish pressure, opening the door to new highs.
Intraday support and resistance levels
For gold: Support is seen around $4,320 or $4,270; resistance is near $4,385 or $4,430.
For silver: Support is around $64.00 or $63.40; resistance is near $65.50 or $66.30.