For the week ending September 7, the international gold market opened with a low, fluctuated, and closed flat after a rebound from the bottom. However, compared to the prior week's closing price, it remained under pressure from the 30-week moving average, indicating that bears still hold the advantage. The outlook favors a sideways consolidation at the weekly level, with the broader direction still tilted toward an upward trend.
Tracing the weekly price action, gold opened lower at the start of the week at $4,427.52 per ounce. Hawkish remarks from Federal Reserve Chairman Warsh and other Fed governors, coupled with escalating US-Iran tensions, pushed oil prices higher and boosted rate hike expectations, dragging gold down to a weekly low of $4,282.42. Subsequently, Trump's comments suggesting the conflict would not last long, dovish remarks from the Fed's third-ranking official, and better-than-expected ADP private payrolls and weekly jobless claims data triggered a rebound from the lows, with gold reaching a weekly high of $4,510.58 on Thursday. On Friday, the US August non-farm payrolls report showed a staggering increase of 162,000 jobs, far exceeding market expectations of 56,000, with substantial upward revisions to prior months' data. This strong employment performance reignited expectations for a September Fed rate hike, causing gold to plummet. Nevertheless, Trump again pressured the Fed for significant rate cuts, lifting gold back to close at $4,430.33. The week ended with volatile back-and-forth trading. The weekly range was $228.16, with a decline of $26.73 (0.6%) relative to the previous week's closing price of $4,457.06.
Looking ahead to Monday, September 7, international gold opened with a slight dip and fluctuated narrowly. Although there is some rebound potential intraday, the numerous moving average resistances on the main chart and bearish signals from the oscillators suggest that any rebound may face resistance and pullback. Thus, both bullish and bearish opportunities exist for the day or the week. Resistance on the upper side can be found at the Bollinger Band middle line and the 200-day moving average, where short positions could be considered, while support on the lower side lies near the 5-day and 30-day moving averages, where buying opportunities may emerge.
From a fundamental perspective, the current geopolitical situation is at a stage of stalemate with persistent risks. For oil prices, this can only facilitate high-level adjustments or renewed strength, keeping inflation expectations elevated and maintaining the outlook for potential Fed rate hikes, which would limit gold's upside. However, this type of inflation is driven solely by oil prices and is not the result of aggregate demand exceeding aggregate supply, nor is it caused by excessive money chasing too few goods. It is also not due to an overheating economy, surging consumption and investment demand, or expansionary government spending raising prices. Rather, it is a classic case of rising production costs pushing up prices, which could lead to stagflation and increase the likelihood that the Fed will continue to adopt a wait-and-see stance.
The key question lies in whether future inflation will become too high, forcing the Fed to raise rates and push gold lower again to retest the June lows (the monthly chart suggests there is still potential for a new low). Alternatively, if inflation eases and rate hike expectations diminish, or if economic growth slows and becomes too weak, the Fed may hold rates steady or cut them, paving the way for gold to challenge historic highs once more.
Additionally, while the latest August non-farm payroll data significantly exceeded expectations with substantial upward revisions to June and July figures, this will likely sustain rate hike expectations in the short term and limit gold's rebound. However, the data's lack of credibility due to large discrepancies may also breed distrust in the market. Consequently, attention will shift to the US August CPI inflation data due on September 11. If inflation also comes in on the high side, the probability of a September rate hike will rise further, potentially pressuring gold downward again. Conversely, if inflation retreats, the Fed still has room to remain on hold, and gold will continue its consolidation phase.
In summary, reviewing the three historical oil crises, each eventually concluded with oil prices spiking and then retreating as the crises gradually subsided, ultimately triggering recessions in Western economies. Although the Fed was ultimately forced to raise rates each time, gold did not experience sustained declines and eventually entered bull markets once again. Therefore, for short-term, intraday, or weekly gold traders, fundamental outlook and directional trends may be less critical. For long-term holders of accumulated gold or physical products, current lows may present opportunities for staged accumulation.
Technically, on the monthly chart, gold is trading above the middle line of the Bollinger Bands, with the bands showing signs of tilting upward, suggesting the potential to challenge historic highs again. However, if it fails to quickly break above $5,100, sustained consolidation could lead to bearish divergence with the oscillators, raising the risk of a reversal down to the $3,700 level or even lower, thereby lowering entry points further. On the weekly chart, gold rebounded last week after touching support near the 60-week moving average, with bearish momentum weakening. However, prices remain below the 30-week moving average and the prior resistance zone, indicating continued adjustment pressure. The short-to-medium-term outlook remains consolidation-focused, with resistance near the 30-week moving average for shorts and support near the 60-week moving average for longs. On the daily chart, the Bollinger Bands are contracting, suggesting a period of horizontal trading ahead. With resistance above and support below, a range-bound approach is advisable, with opportunities for both buying and selling. Resistance on the upper side lies at the 10-day and 200-day moving averages, while support on the lower side is near the 5-day and 30-day moving averages.
For intraday operations, preliminary key levels are as follows, with exact entry and exit points subject to live account notifications: For gold, support lies near $4,405 or $4,390/$4,375, while resistance is near $4,465 or $4,500. For silver, support is near $65.70 or $64.70, with resistance near $66.70 or $67.60.
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