Daily Analysis XAUUSD - 16 Aug 2023

The price of gold (XAU/USD) has rebounded from its lowest level since late June, driven by anticipation of the US Federal Reserve (Fed) monetary policy meeting minutes. This recovery is supported by cautious optimism in the market due to expectations of more stimulus from China and a potential end to the Fed's tightening cycle, influenced by mixed recent US data. Notably, the lack of action by major central banks in recent days indicates a potential conclusion to the rate-hike cycle, providing a foundation for the XAU/USD price. This is especially true with China's willingness for additional stimulus and resilient Indian statistics.

However, positive US Retail Sales and disappointing Chinese data, coupled with robust US Treasury bond yields, pressured the gold price to a multi-day low recently. The XAU/USD was also influenced by the underwhelming performance of riskier assets like equities, Antipodeans, and commodities.

Looking ahead, the market will closely observe US Industrial Production for July and the Federal Open Market Committee's (FOMC) latest Monetary Policy Meeting Minutes for guidance. It's important to consider that any indications of further rate hikes by the US central bank could potentially push the quote below the key support level of $1,900. Gold appears to be losing momentum around the current support area of 1900, and the possibility of a correction seems likely, especially since the DXY has reached a significant historical resistance level.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1960	1953	1942	1931	1920	1900