Gold (XAU/USD) $2,050 Hurdle: Fed Chair Powell Perspective

Gold (XAU/USD) hovers near $2,050/oz. as the market awaits insights from Fed Chair Powell; Analysts predict US ISM Manufacturing data.

In the latest market developments, Gold (XAU/USD) is reluctant to breach the $2,050/oz—mark, setting the stage for anticipation ahead of Federal Reserve Chair Powell’s upcoming remarks.

Gold (XAU/USD) Price Analysis

Gold is cautious at $2,050/oz., maintaining a positive overall outlook. Investors now focus on Fed Chair Powell’s upcoming commentary later in the trading session. Gold made an early push today, nearly reaching a fresh 20-month high. However, the need for conviction in this move is apparent in an otherwise subdued market. The US dollar, which ascended on Thursday, shows minimal change, while US bond yields, influential in recent price dynamics, see marginal increases at best. Speculation suggests that the renewed conflict in Gaza, following the conclusion of a seven-day ceasefire between Israel and Hamas, contributes to the modest uptick. Sources from BBC report that Qatar’s government has confirmed ongoing talks to reinstate the ceasefire.

Gold (XAU/USD) $2,050 Hurdle: Powell Perspective

Later today, the focus will shift to the US ISM Manufacturing data for November, with analysts predicting a print of 47.7, compared to October’s 46.7. Last month, ISM Manufacturing sharply declined after a rebound from 46.0 in June. An ISM reading below 50 signifies a contracting manufacturing sector. 

Furthermore, Fed Chair Jerome Powell will participate in a fireside chat at Spelman College at 16:00 UK and a round table event at 19:00 UK. The upcoming communication marks the last from Federal Reserve members before entering a blackout period preceding the December 13 FOMC meeting. Powell expects to affirm the adjustment of US rates based on data despite the market having entirely priced out any further interest rate hikes.

Gold is currently trading around $2,038/oz., having touched a high just below $2,050/oz. Earlier in the day. The technical perspective on Gold remains bullish; however, an overbought Commodity Channel Index (CCI) reading could hinder its immediate upward movement.

Retail trader data reveals that 47.36% of traders are net-long, with the short-to-long ratio at 1.11 to 1. The number of traders net-long has increased by 0.11% since yesterday but is 15.02% lower than last week. Conversely, net-short traders have decreased by 2.97% since yesterday but are 31.47% higher than last week.

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