Daily Analysis XAUUSD - 12 July 2023

The precious metal is gaining momentum, poised to break above $1,940.00, as the US Dollar Index (DXY) faces significant pressure amid expectations of a slowdown in the United States Consumer Price Index (CPI) data.

While the USD Index has found some support near 101.35, the overall bias remains bearish. Economists at Commerzbank suggest that it might be premature to dismiss the dollar entirely, considering that the recent labor market report was not as negative as anticipated. However, it is expected that the tight labor market will prompt the Federal Reserve (Fed) to raise interest rates again at the end of July.

Investors are currently focused on the upcoming inflation data, with expectations of steady monthly and core inflation rates of 0.3%. Annualized figures for headline and core CPI are projected to soften to 3.1% and 5.0% respectively. Additionally, the release of the Fed's Beige Book will also garner attention from investors.

Gold went back toward the 1940 resistance level building a solid reversal pattern. The challenge will be the break of the actual 1940 level.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1980	1960	1940	1931	1920	1904