Gold Intraday Outlook and Daily Analysis
Gold’s value dropped below its 2002 level during the Asian session due to a short-term pullback. The decline in value is attributed to the growing belief in the market that the Fed will implement a 27bps hike in May, which is supported by the fed fund futures’ 68% probability. The market sentiment was influenced by the robust US non-farm payroll report from last week, but expectations could change after the release of March CPI data and FOMC minutes on Wednesday.
Technically, it appears that a short-term peak for Gold was reached at 2034.05, which is supported by the bearish divergence in the 4-hour MACD. The rally from 1086.48 might have completed a five-wave sequence and halted before reaching the key resistance zone between 2072.06 and 2076.84, which is a record high.
Based on this analysis, a more significant pullback is expected. The critical near-term support level can be found at the 38.2% retracement of 1806.48 to 2034.05 at 1947.11, which is close to the 1951.55 support level. As long as this support zone remains unbroken, the current price action from 2034.05 should be viewed as a brief corrective phase, and a rally to new record highs is expected shortly.
However, if the support zone at 1947.11/1951.55 is consistently breached, it could indicate a more substantial decline, possibly extending the long-term consolidation pattern from 2076.8.