Current trend

The XAU/USD pair is consolidating near 2030.00, waiting for new drivers to appear on the market. Analysts are focusing on American inflation statistics, which can significantly affect the US Federal Reserve's plans to change the vector of monetary policy. Forecasts suggest that the Consumer Price Index will accelerate from 3.1% to 3.2% on an annual basis in December, while the Core CPI excluding Food and Energy could slow down from 4.0% to 3.8%.

One way or another, the American Fed is still expected to launch a program to reduce borrowing costs in the near future: at the beginning of the week, the probability of adjusting the interest rate by 25 basis points during the meeting scheduled for March 19–20 was about 60.0%. In addition, the European Central Bank (ECB), the Bank of England and a number of other regulators may announce an easing of monetary policy, which will make gold more attractive to investors given the ongoing geopolitical tensions.

The US dollar received additional support yesterday from data from the United States on the dynamics of business optimism. The National Federation of Independent Business (NFIB) Business Optimism Index in December increased from 90.6 points to 91.9 points with the forecast of 90.7 points, and the RealClearMarkets/TIPP Economic Optimism in January accelerated from 40.0 points to 44.7 points with expectations of growth to 42.0 points.

Meanwhile, the period of correction continues on the market of gold contracts. According to the report of the US Commodity Futures Trading Commission (CFTC), last week the number of net speculative positions in precious metal decreased insignificantly to 207.6 thousand from 207.7 thousand a week earlier. There is a new wave of increasing demand for the asset: the balance for the "bulls" with swap dealers amounted to 71.317 thousand against 275.886 thousand for the "bears". Last week, buyers increased the number of contracts by 1.464 thousand, and sellers by 7.882 thousand, indicating that traders were gaining positions after a break.

Support and resistance

Bollinger Bands in D1 chart demonstrate flat dynamics. The price range slightly expands from below, but limits the development of "bearish" dynamics in the near future. MACD is going down preserving a stable sell signal (located below the signal line). Stochastic, approaching the level of "20", is trying to reverse horizontally, signaling the risks associated with the instrument being oversold in the ultra-short term.

Resistance levels: 2041.77, 2050.00, 2065.00, 2085.00.

Support levels: 2030.00, 2015.30, 2000.00, 1987.29.

Trading tips

Short positions may be opened after a breakdown of 2015.30 with the target at 1987.29. Stop-loss — 2030.30. Implementation time: 2-3 days.

The return of the "bullish" trend with the breakout of 2041.77 may become a signal for new purchases with the target of 2065.00. Stop-loss — 2030.00.