July 15th: On the previous trading day, Tuesday, July 14th, international gold prices experienced a volatile rebound to close higher. The release of U.S. Consumer Price Index (CPI) data, which came in below expectations overall with the monthly rate recording its first negative value in six years, lowered market expectations for an imminent Federal Reserve rate hike. This pressured the U.S. dollar index to plummet, boosting gold prices to recover most of Monday's losses at one point. However, the rally ultimately faced resistance and retreated upon meeting the middle Bollinger Band resistance. The market also continues to face pressure from strengthening oil prices, which are fueling inflation expectations, suggesting that the primary trend for the precious metal remains one of consolidation.
In terms of specific price action, gold opened the Asian session at $4,003.55 per ounce, initially dipped to record an intraday low of $3,983.81, then halted its decline and began to rise. This upward momentum continued into the U.S. session opening, where buying interest rapidly intensified, pushing the price sharply higher to touch an intraday high of $4,101.54. It ultimately encountered resistance and pulled back, closing at $4,052.58. The daily trading range was $117.73, with a closing gain of $49.03, representing a 1.22% increase.
Looking ahead to today, Wednesday, July 15th, international gold opened with a slightly weaker bias. This is due to the pullback pressure from the overnight late-session decline, coupled with escalating geopolitical risks and strong oil prices, which keep future inflation expectations alive. Therefore, a single data point showing lower inflation is unlikely to provide sustained upward momentum. Consequently, until geopolitical tensions ease and oil prices stabilize or decline again, gold prices will likely remain under pressure. Trading strategy should focus on the ongoing consolidation, with opportunities for both long and short positions within the day.
Key Data to Watch Today
Today's focus will be on the U.S. June Producer Price Index (PPI) year-over-year and month-over-month figures. Based on yesterday's CPI data and current market expectations, these are likely to show further signs of cooling inflation, which would reduce the probability of a rate hike and support higher gold prices. However, the subsequent release of the July Empire State Manufacturing Index is expected to show significant improvement. Given the current high oil prices and ongoing geopolitical risks, any rebound in gold faces the threat of a pullback. The trading strategy leans towards buying first and selling later.
Technical Analysis Perspective
On the weekly chart, gold has once again formed a bottoming and rebounding pattern this week. However, as the price remains below the 60-week moving average, this primarily suggests a continued trend of consolidation for the foreseeable future. A break above the 60-week moving average would significantly increase the momentum for a rebound, potentially targeting the $4,500 area. Conversely, a break below $3,900 could see prices test the $3,700 support level. Within this range, a strategy focused on range-bound trading is appropriate.
On the daily chart, yesterday's halt of the decline and subsequent rebound closed with a gain, forming a potential bullish engulfing pattern. However, the price action remains below the resistance of the middle Bollinger Band and key moving averages, indicating that selling pressure persists. Resistance near the middle Bollinger Band and the 30-day moving average remains a viable area for short positions. On the downside, support from intraday short-term cycle levels and trendline support offers potential areas for long positions targeting a bounce.
Intraday Trading Levels Reference
The following are preliminary reference points for long and short positioning today. Specific entry and exit points should be determined based on real-time market conditions.
Gold: Support to watch near $4,030 or $4,010; Resistance to watch near $4,085 or $4,130.
Silver: Support to watch near $58.45 or $57.75; Resistance to watch near $59.80 or $60.15.
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