Daily Analysis XAUUSD - 25 Aug 2023

Investors await clues about the Fed's rate-hike stance, impacting the near-term US Dollar (USD) and gold price direction. Weak US flash PMI data signaled economic sluggishness in August, postponing Fed tightening expectations. Despite this, hawkish Fed remarks hint at a 25-bps rate increase by year-end.

Boston Fed President Susan Collins suggested steady rates, allowing for potential hikes without indicating timing. Philadelphia Fed President Patrick Harker stressed maintaining a restrictive stance until inflation drops for rate cuts. Such views boost US Treasury bond yields, driving the USD Index (DXY) to a peak since June 6, influencing gold prices.

Amid global economic worries and China's downturn, grim manufacturing surveys stoke recession fears, impacting investor sentiment and favoring gold's safe-haven status. This tempers gold's downside, although caution prevails due to fragile equity markets.

Gold made the awaited reversal movement, breaking the 1919 level and heading towards the 1940 resistance level but the yield started going back and this may lead toward selloff on gold.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1940	1920	1942	1900	1875	1845