Investors are eagerly anticipating the release of the Federal Reserve’s January meeting minutes on Wednesday, seeking additional insights into the central bank’s stance regarding a potential timeline for interest rate cuts. Concerns over a delay or reduction in rate cuts arose following last week’s unexpectedly rapid inflation figures, causing uncertainty among market participants about the Fed’s monetary policy trajectory. Amidst this backdrop, both oil and gold prices experienced modest gains.
The recent decline in the US dollar can be attributed to renewed apprehensions about a potential government shutdown in the United States. House Republicans have shifted their stance from cautious optimism to anticipating a shutdown unless a budget or spending stopgap is enacted by March 1, with a full shutdown looming by March 8. Gold prices have benefited from the weakening dollar, with investors eagerly awaiting the Fed’s January meeting minutes for potential clues on the timing of the first-rate cut this year.
In gold price technical analysis, Tuesday’s daily closing above the $2,023 mark suggests a potential shift in favor of gold buyers. As a result, the immediate resistance level is now identified at $2,033. A sustained breach above this level could pave the way for renewed buying interest, targeting key levels such as the February 7 high of $2,044 and the psychological barrier of $2,050. Conversely, gold sellers will seek to defend the $2,023 level, with failure potentially leading to a downward swing towards support levels at $2,015 and $2,011. Additionally, the $2,002 mark presents a formidable obstacle for sellers.