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XAUUSD aims to shift business above $1,750 ahead of US long-term inflation report

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  • Gold price is looking for an establishment above $1,750.00 amid euphoria in the market.
  • The Fed believes that long-term inflation expectations are well anchored around 2%.
  • The precious metal is hovering around the 200-EMA at $1,760.00

Gold price (XAUUSD) has recovered after a marginal correction that dragged the asset below $1,750.00 in the Tokyo session. The precious metal is aiming to shift its auction profile above $1,750.00 as the risk profile has continued its upbeat performance on Friday.

S&P500 futures are holding their Friday’s bumper gains and a minor recovery in the US dollar index (DXY) is getting exhausted. Rising demand for government bonds has trimmed their returns dramatically. The 10-year US Treasury yields have plummeted to 3.81%.

It is worth noting that US markets will be closed on Friday on account of Veterans Day.

October’s inflation report has clarified that the Federal Reserve (Fed) will re-consider its policy tightening plans and may slow down its current pace of hiking interest rates. However, Cleveland Fed Bank President Loretta Mester believes that restrictive policy measures by the US central bank should continue given the persistent nature of inflation.

The US economy will face one more test of inflation on Friday as long-term inflation expectations will release ahead. The Fed has been reiterating that long-term inflation expectations are well-anchored at around 2%. An increment in the economic data could spoil the market mood ahead.

Gold technical analysis

On the daily scale, the gold price is marginally far from kissing the 200-period Exponential Moving Average (EMA) at $1,760.00 for the first time in the past five months. The horizontal resistance placed from June 14 low at $1,805.11 will act as a major hurdle ahead.

The Relative Strength Index (RSI) (14) has overstepped 60.00 for the first time in seven months, showing no signs of divergence and overbought.

Gold daily chart


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