July 23: In the previous trading session on Wednesday, July 22, international gold prices continued their rebound to close higher. The move was supported by technical buying and a partial return of haven demand. The price broke through the resistance of the 30-day moving average, indicating strengthening bullish momentum. While a short-term continuation of strength is anticipated, a pullback is noted near the resistance of the 60-week moving average, warranting attention to near-term adjustment risks. The outlook remains bullish, with support levels such as the middle Bollinger Band being watched below, and targets of the 60-week and 10-week moving average resistance above.
In terms of specific price action, gold opened the Asian session at $4,078.64 per ounce, briefly recording an intraday low of $4,076.70 before rebounding. It reached above $4,140 by midday, then retreated from resistance as anticipated, allowing short positions to take profit. During the early U.S. session, the price rebounded again from below $4,110, reaching an intraday high of $4,165.70 around 23:00, before encountering resistance and pulling back once more. It ultimately settled at $4,129.85, marking an intraday range of $89, a gain of $51.21, or 1.25%.
Looking ahead to Thursday, July 23, international gold opened with a continuation of the late-session pullback from the previous day, initially showing weakness. The U.S. dollar holding above a broken resistance level, coupled with ongoing gains in oil prices fueling inflation and rate hike expectations, is capping gold's upside, creating some near-term corrective pressure on the rebound.
The focus for the day will be on the European Central Bank's interest rate decision and the subsequent monetary policy press conference by President Christine Lagarde, as well as data including the U.S. weekly initial jobless claims for the week ending July 18. Market expectations are for the ECB to keep rates unchanged, but previous indications suggest it may add to prospects for a September rate hike, which would be bearish for the dollar and bullish for gold. Combined with expectations for favorable U.S. jobless claims data, this suggests gold may retain rebound momentum during the U.S. session. Therefore, focusing on support levels during the Asian and European sessions for potential long entries remains a valid approach.
Key attention should be paid to geopolitical developments and next week's Federal Reserve interest rate decision. Remarks from Chairman [Note: Original text mentions "Wash," likely a typo for "Powell"] and the Fed's decision will be crucial in determining whether gold can break above the 60-week moving average and strengthen towards the $4,500 area, or whether it will decline again to test support near the 100-week moving average around $3,700.
From a fundamental perspective, the market generally believes the declines seen in previous months have been largely digested. Persistent geopolitical tensions and shipping lane blockades are spreading risk premiums, gradually bringing haven demand back into focus. Beyond allocations to the U.S. dollar and Treasuries, there is a renewed allocation to traditional haven assets like gold. Concurrently, the gold market's sustained consumption of these factors appears somewhat fatigued, suggesting room for a phased recovery and a gradual weakening of bearish reactions.
Consequently, looking forward, if tensions persist, haven sentiment is likely to continue supporting gold prices over the next several trading sessions. If tensions ease, reduced inflation and consequently lowered rate hike expectations would also aid a gold rebound. Thus, gold prices may either continue consolidating at a base or begin a gradual strengthening rebound. Should prices decline again, each subsequent low could be viewed as an opportunity to establish long positions.
Technically, on a monthly chart, gold formed a solid bearish candlestick in June, indicating sustained selling pressure and suggesting the potential for a further decline this month towards the support of the middle Bollinger Band around $3,820, or even lower. Although the overall downtrend has paused and the price action shows signs of a potential bullish reversal, it remains under the downward pressure from June's decline and has not yet reclaimed the key ascending trendline. Therefore, until June's losses are recovered, the risk of a renewed decline to test lower levels persists. The bias is for a potential sideways consolidation within a broad range of $4,500 to $3,600 for several months before resuming an upward climb.
On a weekly chart, gold has been oscillating and adjusting over recent weeks, showing a tendency to form a base ahead of an upward move. This week's halt in declines and move higher suggests a potential bullish engulfing pattern, indicating a positive outlook. However, before breaking above the resistance of the 60-week moving average, the price remains under pressure. Support near the trendline around $3,930 will need to be watched below, with the expectation of continued adjustment above this level. Alternatively, a test of support near the 100-week moving average around $3,650 could provide a stronger base for a more substantial bullish rebound.
On a daily chart, after recent consolidation and adjustment above trend support, gold has rebounded. It is currently trading above the short-term moving averages and the middle Bollinger Band, having also broken through the resistance of the 30-day moving average. This indicates a strengthening of bullish momentum, with a short-term potential for continued rebound and strength. Downside support levels such as the short-term moving averages should be monitored for potential long entry points. Upside targets include the upper Bollinger Band and the resistance of the 60-day moving average.
The following are preliminary reference points for long and short positioning during the day; specific entry and exit points should be determined based on real-time trading notifications.
Gold: Support to watch around $4,100 or $4,070; Resistance to watch around $4,170 or $4,200.
Silver: Support to watch around $58.75 or $58.10; Resistance to watch around $60.65 or $61.40.
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