Key FundamentalS & EVENTS IMPACTING SPOT GOLD in June 2023:

1. FED: Bets that the Federal Reserve will choose to push pause (albeit temporarily) on its long-standing interest rate tightening campaign grew following comments from two key officials on Wednesday, marking the latest twist in an ongoing debate over the U.S. central bank’s optimal policy path.

Fed Governor Philip Jefferson said in a speech on Wednesday that skipping a hike at the bank’s two-day meeting starting on June 13 would allow the rate-setting Federal Open Market Committee to “see more data” before making decisions about further increases to borrowing costs. As President Biden’s nominee for Fed vice chair, Jefferson is widely seen as a central figure in shaping future policy. Other Fed policymakers, however, have not shared these viewpoints, arguing that another rate rise may be needed to quell stubbornly elevated inflation.

2.YEN: USD/JPY The Japanese yen strengthened on Tuesday after an announcement of an emergency meeting of senior Japanese officials including from the central bank. n Tuesday as the dollar hit a 10-week high against peers and a six-month top versus the yen before Japanese officials gave their currency a nudge, as investors kept a wary eye on global policy makers.

Japan will closely watch currency market moves and respond “appropriately” as needed, the country’s top currency diplomat said on Tuesday after financial authorities met in response to a weakening in the yen to its softest in six months versus the dollar. The yen strengthened on news of the meeting, and held onto those gains, with the dollar last down 0.2% at 140.16 yen having earlier risen as high as 140.93, its highest since November 2022. “In the short term, the dollar-yen may remain on an uptrend as the real interest rate has continued to fall in Japan and the BOJ remains dovish, “It is hard to see the yen’s rebound until the BOJ takes action on monetary policy.”
Impact Yen + USD – USDJPY: 141.000 – 138.400 | USDJPY CMP 138.880

3.Debit Ceiling: Focus also remained on an ongoing vote in Congress to raise the U.S. debt ceiling. The House on Wednesday overwhelmingly passed legislation negotiated by President Biden and Speaker Kevin McCarthy to suspend the debt ceiling and set federal spending limits, as a broad bipartisan coalition lined up to cast a critical vote to pull the nation back from the brink of economic catastrophe. Lawmakers from both parties joined to approve the bill 314-117 Wednesday evening, sending the measure to the Senate for consideration as a default deadline draws near.
The debt bill would remove the threat of another default crisis for the remainder of Biden’s current term, suspending the debt ceiling until Jan. 1, 2025. In exchange, Democrats agreed to cap federal spending into 2025, likely forcing some retrenchment in government services given the current 5% annual inflation rate.

4. The US Dollar Index (DXY) continued rising in May from 100.500 zone towards 104.600 zone, CMP 103.800 crashing since last 3 days from 104.600 towards 103.800 zone. This also impacted XAUUSD and a crash in Gold price was observed from $2048-$1932 in the month of May in 2023. Since last 3 days a crash in DXY was observed resulting in higher XAUUSD price: $1932 -1985 zone. Today’s high: $1983.

5. US NFP: The economic activity in the US manufacturing sector continued to contract at an accelerating pace in May with the ISM Manufacturing PMI dropping to 46.9 from 47.1 in April. This reading came in worse than the market expectation of 47. More importantly, the inflation component of the PMI survey, Prices Paid Index, fell sharply to 44.2 from 53.2, compared to analysts’ estimate of 52. The data published by Automatic Data Processing (ADP) showed on Thursday that private sector employment in the US rose by 278,000 in May. This reading surpassed the market expectation of 170,000 by a wide margin. Underlying details of the publication revealed that the annual wage inflation for ‘job stayers’ declined to 6.5% from 6.7% in April. The US Bureau of Labor Statistics revised the change in Unit Labor Costs for the first quarter lower to 4.2% from 6.3% in the advanced estimate. Other data from the US revealed that there were 232,000 initial claims for unemployment benefits in the week ending May 27, compared to 230,000 in the previous week.

In current scenario, and as per past data fundamentals-based co-relations have guided us in a more accurate manner than technical co-relations, however I prefer to compare and match both for a better accuracy.

How to trade Spot Gold XAUUSD on NFP data today?

XAUUSD Bearish Scenario: $1926/1907/1888/1866?

If the bearish momentum extends, gold price may fall further towards $1926/1907/1888 price trap zone with 1866/1836/1818 as next stops, if Gold crash halts at 1888/1866 or 1836/1818 zones a reversal can be expected with a RT V 23.6 M15 M30 RT before/in next 10 trading days.

XAUUSD Bullish Scenario: $2048/2069/2096/2109/2121?

If the Bullish momentum pushes Gold price across $2042 barrier, $2069, $2096 followed by $2109, $2121 zone can be the next target for Gold, opening way to $2145 zone as an ideal sell entry.

Heading into the NFP show today, Spot Gold price is under a price trap of $2045 zone, as investors/traders are observing market closely after FED interest rate and monetary policy related statements by Mr. Powell on 14 June, 2023.

BUY/SELL STOPS | B/S LIMITS: TARGET RT 23.6 TF M15/30/H1 or NAP $5 each set:   

S2 ZONE 1953 | DOWN TREND (Below $1936) : 1926/1907/1888/1866/1836 | BUY LIMITS
R2 ZONE 2001| UP TREND (Above $2033)        :  2042/2069/2096/2109/2121| SELL LIMITS

Technical Analysis | XAUUSD CMP $1975 | Gold Price – SR (D1) (MN) Levels to watch:

02.06.2023 | XAUUSD: Spot Gold Price Projection and Trading Scenario

PROJECTED TRADING SCENARIO:

• Observe price at US OPENING D1 SS1 and then US SS2
• Observe SR: S2-3/6/9 zone and D1.SR R3+3/6/9 zone for reversals/retracement
• Do not enter between the pivot zone D1: S/R zones
• ObserveD1SR: FIB 23.6% on M5 and M5/M15 TF for NAP target price based exit in buy or sell entry after 30/60/90/120 minutes of NFP and $15/30 price movement sets
• Movement of $70/90 dollars on Gold price is not something unexpected nowadays, and a surprise on Monday during early trading hours cannot be ruled out too, so closing all positions today in net average profit is always the best trading strategy for every trader who wants to safeguard his principal.

  I expect A pattern on M30 and H1 TF chart in next 10 days (short term target) and 18 trading days (long term target). XAUUSD CMP $1975.Point to be noted: let us not forget ongoing geo-political tensions which can trigger an upward price rally of more than $150/200 in Spot Gold price. Another catalyst of low volumes might step in too during Monday early morning opening.Terms: TF: Time Frame | RT: Retracement | SR: Support Resistance | NAP: Net Average Profit

  It is always wise to first PLAN THE TRADE, and then TRADE THE PLAN!

  Hence, it is suggested to first observe the crash or rise with specific zones and levels in mind on the basis of various fundamental and technical parameters mentioned above, before entering a trade in a specific direction with a target of net average profit in a specific set of trades.

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