Gold experienced a volatile trading session on July 15th, moving within a range of several dozen dollars.
The price began to decline at the Asian market open, falling to just above the $4010 level before rebounding, with a long position entered early in the range.
The price then climbed, reaching above $4070 during the US session before losing upward momentum, prompting a manual exit of the long position for a profit exceeding 50 dollars.
Gold ultimately settled at $4059, closing the day with a small bullish doji candlestick.
Economic Data Impact
The US Producer Price Index (PPI) data for June, released on the evening of July 15th, reaffirmed the trend of cooling inflation.
Its overall direction aligns with the Consumer Price Index (CPI), indicating that inflationary pressures are easing.
Geopolitical tensions impacting energy prices are viewed as a one-off event, unlikely to alter the medium-term downward path of core inflation.
Federal Reserve Testimony
Additionally, Federal Reserve Governor Waller's continued testimony before the Senate maintained his core message from the first session.
He reiterated a focus on inflation but did not release any new hawkish signals.
His failure to "add fuel to the fire" is considered a "not bad" development for bulls.
The absence of the feared "hawkish barrage" has slightly reduced upward pressure on gold.
Key Data Ahead
The focus tonight is on the US Retail Sales data for June and the weekly Initial Jobless Claims figures, scheduled for release.
Weaker retail sales data, suggesting economic cooling, could benefit gold.
Conversely, stronger-than-expected data may boost the US dollar and weigh on gold prices.
Trading during the Asian and European sessions is likely to be subdued as markets await this directional cue.
Technical Perspective
From a technical standpoint, gold fluctuated roughly between $4080 and $4020 in the previous session, influenced by fundamental data releases.
This activity has potentially established an intraday consolidation pattern on the hourly chart.
For the current session, resistance is monitored near the upper boundary of the range around $4075-80.
Support is watched near the lower boundary around $4020-15.
A break above resistance could lead to a test of the $4095-4100 area, while a break below support might target $3980 or even the $3960-50 zone.
Trading Strategy
In summary, both bulls and bears are awaiting tonight's retail sales data for directional clarity, with the daytime session likely to remain range-bound.
Traders are advised to avoid chasing breakouts today and instead consider range-trading strategies, selling near resistance and buying near support.
A more conservative approach would be to limit activity during the quiet Asian and European hours and wait for the US data release before taking a position.
Given the current high level of macroeconomic uncertainty, protecting capital remains the foremost priority.
Operational Recommendations for the Day
Gold: Continue trading within the $4010-$4090 range. Set a stop-loss of $10 and a take-profit target of $60-70.
Key Economic Data and Events for July 16th
US Weekly Initial Jobless Claims
US Retail Sales Month-over-Month for June
US Philadelphia Fed Manufacturing Index for July
US NAHB Housing Market Index for July
US Business Inventories Month-over-Month for May
US Pending Home Sales Index Month-over-Month for June
Speech by Federal Reserve's Logan
Speech by Federal Reserve's Schmid
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