What are the major factors responsible for rising XAUUSD Gold Prices | CMP $2711 ATH XAUUSD
Gold price (XAU/USD)🔺 prolongs its multi-day-old uptrend and climbs further beyond the 🔺$2,700 mark, hitting a fresh record high during the Asian session on Friday. The momentum is sponsored by the expected interest rate cuts by major central banks, which tends to boost demand for the non-yielding yellow metal.
Apart from this, escalating tensions in the Middle East and the uncertainty surrounding the US Presidential election turn out to be another factor underpinning the precious metal.
The focus now shifts to the Middle East geopolitical updates and Fedspeak for further trading impetus.
I had projected target price of $2711 for XAUUSD yesterday at 11.41 hours. XAUUSD breached the mark of $2700 and hit our target price before reversing back to $2707 at the time of writing.
Verify here:Â https://x.com/piyushratnu/status/1847133559770829135
I had projected a strong possibility of a + rally in XAUUSD ($2707/2727 zone) on 14 October 2024 too based on various factors including geo-political tensions, FED rate cut, Chinese stimulus and others. Read here.
Why XAUUSD breached the mark of $2700?
♦️Chinese Stimulus related optimism
🔺The mixed Chinese growth and activity data combined with the People’s Bank of China’s statement have rekindled stimulus hopes. The renewed market optimism also diminishes the Greenback’s appeal as a safe-haven currency.
♦️ TRUMPISM
🔻The USD retreats from over two-month highs against its six major rivals in Asian trades on Friday, as buyers take a breather after the recent rally back by the market’s optimism that Republican nominee Donald Trump is set to win the 2024 US presidential elections. Trump’s fiscal and trade policies are seen as inflationary and positive for the Greenback.
♦️ Interest Rate Cut
US Retail Sales rose 0.4% in September after an unrevised 0.1% gain in August, the Commerce Department’s Census Bureau said on Thursday. Strong US data indicated robust economic prospects but that failed to alter the odds of a 25 basis points (bps) rate cut by the US Federal Reserve (Fed) in November. Markets are currently pricing in a 93% probability of such a move by the Fed next month.
A period of low-interest-rate regime tends to benefit the non-interest-rate bearing Gold price.
♦️Geo-political tensions:
Gold price found fresh haven demand amidst escalating geopolitical tensions between Iran and Israel. Iran-backed militant group, Hezbollah, said it will escalate war with Israel after Israel’s Foreign Minister confirmed the killing of Hamas leader Yahya Sinwar on Thursday.
What’s NEXT?
Looking ahead, all eyes remain on the speeches from several Fed policymakers and the rife tensions in the Middle East for further upside in Gold price. The end-of-the-week flows could also play its part in driving the volatility around Gold price.
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