Gold prices are fluctuating in a narrow range on Friday, as traders assess the latest data on the state of the U.S. economy and hawkish signals from the Federal Reserve System (Fed).
The precious metal fell to a three-month low on Thursday before reversing upward.
As Marex metals analyst Edward Meir pointed out, the difficulties in gold growth are caused by the Fed's tight position on inflation and interest rates. In this context, the demand for gold is not getting the necessary support.
New forecasts by the Fed signaled the possibility of a further half-percent increase in borrowing rates by the end of the year. After that, the probability of an increase by 25 basis points in July was estimated by traders at 72%.
Robert Kiyosaki, a well-known entrepreneur and investor, tweeted about the possible bankruptcy of Loan Depot. He also claims that the series of bank failures is not over yet.
At the same time, Fed Chairman Jerome Powell considers the U.S. banking system reliable and stable. At the end of the last Fed meeting, Powell said that it is impossible to assess the full impact of credit tightening after banking turmoil.
As Kiyosaki said last week, the U.S. real estate industry could face difficulties. According to him, the crisis of 2023 will be much more severe than the collapse of the financial system in 2008. Kiyosaki recommends to buy more gold, silver and bitcoin.
Gold is considered a safe haven asset amid economic instability.
Gold exchange rate moved back into the 1935.00 - 1984.00 range. The breakdown of the range support and the subsequent rise in price has formed a new series of waves.
Precious metal prices are in the process of forming a third ascending wave on the M30 timeframe. The break through the top of the first wave at 1960.40 has already happened. An increase in the upward movement of the price may start in the near future.
Signal:
Short-term prospects for gold are to buy.
The target is at the level of 1984.00.
Part of the profit should be fixed near the level of 1970.00.
The stop-loss is at the level of 1940.00.
Bullish trend has a short-term character, so the volume of trade should not exceed 2% of your balance.
This content is for informational purposes only and is not intended to be investing advice.
