Skip to Content
News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site. See our updated Privacy Policy here.

Free Trading Guides
Subscribe
Please try again
Select

Live Webinar Events

0

Economic Calendar Events

0

Notify me about

Live Webinar Events
Economic Calendar Events

H

High

M

Medium

L

Low
More View More
Gold Price Outlook Fixated on Trade War Risk, FOMC Minutes

Gold Price Outlook Fixated on Trade War Risk, FOMC Minutes

Rich Dvorak, Analyst

Share:

Gold Price Outlook Fixated on Trade War Risk, FOMC Minutes

GOLD PRICE OUTLOOK – TALKING POINTS

  • Gold has potential to rebound sharply from its recent stretch of weakness if looming risks intensify
  • XAUUSD might continue to face short-term weakness from the threat of recovering risk appetite and potentially hawkish Fed minutes
  • Read about How to Trade Gold or download the free DailyFX Q2 Gold Forecast for additional insight

On Thursday we highlighted how spot gold prices dropped from a 1-month high as yields rebounded along with risk appetite. Gold faced further weakness during Friday’s trading session as short-term interest rates climbed higher along with the US Dollar in response to a robust Consumer Sentiment report. Gold was subsequently dragged lower considering American consumers reportedly feel the most optimistic in 15 years with rebounding inflation expectations – a development that may help keep Fed rate cut prospects at bay.

GOLD PRICE (XAUUSD) CHART: 1-HOUR TIME FRAME (MAY 10, 2019 TO MAY 17, 2019)

Gold

The risk that markets are overpricing the probability that the Fed cuts rates this year could weigh negatively on gold if reversed. Wednesday’s release of the latest FOMC meeting minutes could trigger traders to develop a more hawkish perception of the Fed which would threaten XAUUSD due to the prospect of higher future interest rates. This in additional to weak gold chart technicals merges with the possible further weakness in the Chinese Yuan – all of which could serve as headwinds to gold.

Although, markets will likely obsess over US China trade war developments next week which will likely fuel risk appetite. Ultimately, this looks to largely dictate whether or not gold can catch a safe-haven bid from traders fleeing risk which could push XAUUSD higher.

- Written by Rich Dvorak, Junior Analyst for DailyFX

- Follow @RichDvorakFX on Twitter

Looking for a technical perspective on Gold? Check out the Weekly Gold Technical Forecast

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES