· Gold Price Forecast: Falling yields could fuel a sustained break above $1,878 in XAU/USD
Gold price is likely to trade in a familiar range between $1,850 and $1,878 in the day, until the bulls find a strong foothold above the June 14 tops of $1,878.
A daily closing above the latter will trigger a fresh advance towards the $1,900 psychological level, above which the horizontal trendline resistance around $1,904 will challenge the bearish commitments.
The 14-day Relative Strength Index (RSI) is sitting just beneath the overbought region, allowing room for more upside. The 100-Daily Moving Average (DMA) has pierced through the 200-DMA from below, representing a bull cross, adding credence to the bullish outlook on gold price.
On the downside, a breach of the $1,850 demand area could expose the November 11 lows of $1,843. Further south, the previous critical resistance now support at $1,834 will be the level to beat for gold bears.
· Gold Price Forecast: XAU/USD sits tight as traders mull inflation concerns
Update: Gold (XAU/USD) is holding on in bullish territory and is attempting to continue high following the dip at the start of the week. The price is flat in Asia around $1,868.00 and has stuck to a tight range between $1,870.94 and $1,866.33 so far.
· Gold Price Forecast: XAU/USD to struggle to rally on a peak in inflation expectations – Credit Suisse
Gold has cleared key resistance from the July and August highs and downtrend from August 2020 at $1,834 for the completion of a five-month base. XAU/USD may be set for the beginning of a more important turn higher but strategists at Credit Suisse are concerned is that gold strength may come to a swift end if inflation expectations peak.
Initial support is seen at $1,834
“Gold may be seeing the beginning of more important turn higher after completing a base. We thus look for a move to the June high at $1,917 initially. Beyond here can reinforce the likelihood of a more important move higher with resistance seen next at $1,959/77 and eventually the $2,075 record high.”
Support is seen at $1,834 initially, then $1,814.”
“Our base case though is that we are close to a peak in inflation expectations, which if correct would suggest Real Yields should soon find a floor again around -1.25/1.26% and start to rise again. If our view is correct, it would suggest it may be difficult to see XAU/USD rally meaningfully on such a development, unless we see signs of a broader market ‘risk-off’ phase.”
· Gold Price Forecast: XAU/USD to extend its upside momentum as yields will remain negative – ANZ
· Spot gold may revisit $1,876.90; pullback surprisingly shallow
· Dollar pauses for breath, hovers below 16-month top
The dollar index, which measures the currency against a basket of six rivals, hit its highest since mid July 2020 on Wednesday at 96.226.
On Thursday the euro was at $1.1327, languishing near a 16-month low.
The British currency was last at $1.3502, up slightly on the day.
Against the Japanese currency, the dollar inched down to as low as 113.86 yen on Thursday but was still in sight of Wednesday’s 4-1/2-year high of 114.97
· China's yuan hits 6-yr high against peers, investors see greater PBOC tolerance
China's yuan hit a near six-year high against major peers on Thursday, on investor views that authorities are likely to tolerate a rise in the currency, at least in the near-term.
Prior to market opening, the People's Bank of China (PBOC) set the midpoint rate at 6.3803 per dollar, 132 pips or 0.2% firmer than the previous fix of 6.3935, the strongest since June 2.
· Turkish lira pares losses after touching all-time low near 11 to the dollar
The lira is down more than 32% against the dollar this year and its decline pushes prices higher in Turkey via imports.
· EMERGING MARKETS-Most Asia FX rise, Thai baht leads gains
· U.S.-China tech war clouds SK Hynix’s plans for key chip factory in China
Plans by Korea’s SK Hynix to overhaul a huge facility in China so it can make memory chips more efficiently are in jeopardy, sources familiar with the matter told Reuters, because U.S. officials do not want advanced equipment used in the process to enter into China.
The potential setback could make SK Hynix, one of the world’s biggest suppliers of DRAM memory chips that go into everything from smartphones to data centers, the next victim of the geopolitical struggle between the United States and China.
· Business travel demand expected to surge in 2022, but full recovery still two years away
Business travel spending worldwide will likely jump more than 37% next year to over $1 trillion but the normally lucrative industry won’t fully recover until 2024, according to a new industry forecast released Wednesday.
Surges in Covid cases and new variants, uneven vaccination rates and supply chain problems hurt this year’s recovery, according to the Global Business Travel Association’s new forecast. Business travel spending this year will likely rise 14% from 2020 to $754 billion, slower than the 21% year-over-year increase it forecast in February.
· Merkel warns fourth Covid wave is hitting Germany with ‘full force’
Germany’s Angela Merkel has described the Covid-19 situation in her country as “dramatic,” as the outgoing chancellor considers how to deal with an infection rate that has hit a record.
“The fourth wave is hitting our country with full force,” Merkel told an event for the Association of German Cities, according to a translation by Deutsche Welle and several other media outlets.
· Indonesia c.bank keeps rates steady to support recovery from pandemic
· Philippine c.bank holds rates, but flags inflation risks in 2022
· Belgium announces new Covid restrictions, but prime minister vows to avoid lockdown
Reference: Business Recorder, FXStreet, Reuters, CNBC
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