International gold prices opened higher on Monday, July 27, as a temporary halt to hostilities between the US and Iran sparked ceasefire expectations.
However, market participants remained cautious that the relief might be short-lived, leaving a gap from the high open that needs to be filled. Consequently, the rebound was limited, and prices oscillated to a modest gain relative to Friday's close. Despite this, gold failed to break decisively above the 30-day moving average resistance. The overall trend remains confined to a range-bound consolidation, with the 100-day and 200-day moving averages forming a bearish death cross, signaling a potential risk of a break below the 4000 handle. Until the trend reverses, any rally should be approached with caution. In terms of price action, gold opened $75 higher at $4088.60 per ounce in Asia, hitting an intraday high of $4115.74 before entering a downward consolidation pattern. It touched an intraday low of $4065.07 during the early US session, eventually stabilizing and closing at $4076.42. Compared to Friday's close of $4055.22, the daily range was $60.52, with a net gain of $21.20, or 0.52%.
Looking ahead to Tuesday, July 28, international gold prices opened weaker, pressured by yesterday's retracement and the 30-day moving average resistance. Additionally, the US dollar index staged a sharp V-shaped reversal on Monday, erasing all intraday losses to close higher, maintaining its recent rebound trend and applying pressure on gold. Market caution ahead of what is expected to be one of the most unpredictable Federal Reserve interest rate decisions in recent years also limited the upside for gold bulls. Today's data includes the US weekly ADP employment change for the week ending July 11, the FHFA house price index for May, the S&P/Case-Shiller 20-city home price index for May, the Conference Board consumer confidence index for July, and the Richmond Fed manufacturing index for July. The market's overall expectation leans bearish for gold. Therefore, the focus should be on the potential for a pullback today to fill the gap created by the week's high open.
The key events are the Federal Reserve's interest rate decision on Thursday morning Beijing time and the release of the US June PCE inflation data that evening, which will provide further policy signals. The market currently expects the Fed to keep rates unchanged. Given former President Trump's recent push for a rate cut, advocating for the US to have the lowest global rates, Fed Chairperson's subsequent press conference is likely to have a dovish leaning. Furthermore, the PCE data is expected to decline, which would reduce the likelihood of rate hikes. Consequently, the week's trend is more likely to be characterized by oscillation or a rebound. Therefore, the gap filling should be viewed as an opportunity to buy into the market.
Technically, on the weekly chart, gold prices have been consolidating in recent weeks, exhibiting a tendency to form a bottom and move higher. Last week's pattern was a bullish reversal candle, suggesting potential for a rebound this week and beyond. However, until the price breaks decisively above the 60-week moving average resistance, the trend remains under pressure, with a risk of further downside after oscillating. Support is seen near the trendline at $3930, which could be a buying opportunity, with a more significant bounce expected upon touching the 100-week moving average near $3650.
On the daily chart, gold opened higher at the start of the week but failed to break above the 30-day moving average resistance. It remains within a recent trading range, limiting both bullish and bearish potential. Short-term trading is expected to be range-bound, offering opportunities for both long and short positions. Focus on short-term resistance for selling opportunities and short-term support for buying. The following are preliminary intraday target levels for reference, with actual entry and exit points subject to real-time position updates: Gold: Support levels are around $4050 and $4010; resistance levels are around $4100 and $4135. Silver: Support levels are at $57.80 and $57.40; resistance levels are at $59.00 and $59.70.
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