{x} | Trading.live

Fundamentals

In the Asian session on Friday, December 1, spot gold moved slightly higher, and it's currently trading around $2042. Data show that the U.S. labor market and inflation are cooling, further strengthening the rate cut expectations. At the same time, however, Fed officials made hawkish remarks. Dovish San Francisco Fed President Mary Daly said she is not thinking of rate cuts yet. This has stamped out market sentiment to a large extent. The dollar index and U.S. bond yields stopped falling and rebounded, while gold prices retraced, falling as low as $2031.5 but failing to effectively break below $2032. Overall, gold prices fluctuated in the range of $2032-$2047, a bit lower than our entry point, so we did not enter the market yesterday. Every day we are in a complex market and swallowed by a variety of news. It's not easy for us to verify all the news. What we can do is learn to analyze charts. We can take a rest in a market we can't understand or don't expect. No one can make money in each trade. Making fewer mistakes is the way to success!

Data: The U.S. core PCE price index growth slowed to 3.5% year-on-year in October, the lowest level since April 2021, compared with the previous reading of 3.7%. Personal income increased by 4.5% year-on-year, the lowest level since December 2022; spending increased by 5.3% year-on-year, the lowest since February 2021; U.S. initial jobless claims rose to 218,000 last week, while continuing jobless claims increased to 1.927 million for the week ended Nov. 18, the highest level in about two years, indicating that the U.S. labor market is cooling down.

Speeches: New York Fed President John Williams, the Fed's No.3 figure,  said the Fed's benchmark lending rate is at or near its peak level. He expected monetary policy to remain restrictive for some time. Dovish San Francisco Fed President Mary Daly said she is not thinking of rate cuts yet.

Today's focus: U.S. ISM Manufacturing PMI for November.

Technical Analysis

Yesterday, the gold price is basically in a downward trend. It fell to as low as $2032 in the U.S. session from the high of $2047 in the Asian session, and finally closed with a full bear candle. In recent days, we have been emphasizing that the gold price is in a bearish divergence state, so we don't expect it to rise much further and mainly recommend investor go short at highs. Yesterday's bear candle also indicates a reversal. At present, there is a golden cross showing near the 0 axis in the 1-hour timeframe, a rebound may be seen at the hourly level. In the 4-hour chart, however, a death cross is showing in the overbought region, indicating a bearish trend in a larger timeframe. An hourly rebound today is also an opportunity for us to go short, with the first resistance in the $2047-$2052 range and the second at the $2065 level. The support is located at $2032. If it is effectively broken, perhaps the price will fall to the $2018-$2020 area. Today's trading reference range is $2028-$2048, and traders can buy low and sell high in this range, with shorting at highs being the priority.

Trading Recommendations

Trading direction: Short

Entry price: 2048

Target price: 2018

Stop loss: 2053

Support: 2032.000, 2018.000

Resistance: 2050.000, 2065.0