On Monday, August 10, international gold prices rallied and closed higher, bouncing back with strength. Despite challenges such as the Strait of Hormuz reopening becoming more difficult, with both the US and Iran demanding compensation, and Federal Reserve official Hammack suggesting multiple rate hikes may be needed to curb inflation, gold found support. The key driver was the central bank's increased gold purchases in July, combined with a breakout in technical momentum, which fueled fear-of-missing-out buying. This propelled the price higher, reaching the 100-day moving average target, with bullish momentum showing no signs of weakening. In the short term, it could extend gains toward the 200-day moving average resistance around $4,500.
In terms of price action, gold opened at $4,341.22 per ounce in Asian trading and traded in a range during the session. It hit a daily low of $4,313.28 early in the day, then gained momentum in early US trading, breaking above the European session high of $4,362. It reached a daily high of $4,394.86 before closing steady at $4,390.03, with a daily range of $81.58 and a gain of $48.81, or 1.1%.
Looking ahead to Tuesday, August 11, international gold opened stronger, supported by buying momentum, though crude oil encountered some resistance early in the session. As gold approaches key resistance levels, with Iran and the US exchanging conditions over the Strait of Hormuz reopening, oil prices surged, reinforcing the safe-haven and anti-inflation narrative. This suggests gold may face short-term volatility or a pullback from resistance, but the medium-to-long-term outlook remains upward, with potential for new highs by year-end or next year.
This week, focus will be on US CPI and PPI data, which will shape Federal Reserve policy expectations. If inflation data continues to weaken, the likelihood of a September rate hike will decrease, potentially pushing the US dollar and Treasury yields lower, opening more room for gold to rise. Conversely, if inflation surprises to the upside, rate hike expectations could resurface, leading to short-term pressure at the 200-day moving average and 30-week moving average.
On the fundamental side, uncertainty over this week's inflation data and ongoing Middle East negotiations could trigger short-term volatility. If inflation data comes in stronger than expected, a repricing of rate expectations may weigh on gold, potentially leading to another correction. However, any pullback should be viewed as a buying opportunity. Over the long term, gold's strategic value remains intact despite short-term fluctuations.
Official data last week showed that China's central bank increased its gold reserves in July at the fastest pace since October 2023. A World Gold Council survey indicated that 45% of central banks plan to increase their gold reserves over the next 12 months, with 89% expecting global official gold reserves to rise further. Against a backdrop of rising global debt, frequent geopolitical conflicts, and central bank diversification, official and institutional demand for gold continues to accumulate. Even if short-term corrections occur, they remain opportunities to build positions.
On a weekly chart, gold surged last week, rebounding strongly from the uptrend line support after a period of consolidation. It is now trading above the 5- and 10-week moving averages, as well as the 60-week moving average. The MACD histogram shows diminishing bearish momentum, while the KDJ has formed a bullish crossover, suggesting further upside toward $4,500 or $4,700. However, resistance from the Bollinger Band midpoint, the 30-week moving average, and the uptrend channel warrants caution against a pullback.
On the daily chart, gold has consolidated above the uptrend line and strengthened again, but the 100-day moving average has crossed below the 200-day moving average, forming a bearish crossover. This signals potential resistance risk, but a sustained break above these levels could confirm further upside. In the short term, resistance is near the 200-day moving average, with support at the upper Bollinger Band and short-term moving averages. Below are intraday support and resistance levels for reference, with actual entry and exit points based on real-time positions:
Gold: Support at $4,370 or $4,340; resistance at $4,430 or $4,470.
Silver: Support at $65.10 or $64.70; resistance at $67.00 or $68.00.
Comments