Gold Price Breakout Needs Confirmation, FOMC Eyed

• XAU/USD is bullish as long as it stays above the lower median line.
• The US data should bring high action today.
• A new higher high activates further growth.

The gold price extended its growth, reaching $2,040 today. Now, the precious metal has retreated a little and is trading at $2,035 at the time of writing.

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XAU/USD jumped higher as the US dollar dropped after reaching yesterday’s high of 103.82. Today, the US data should be decisive. The CB Consumer Confidence is expected to jump to 114.2 from 110.7 points, while JOLTS Job Openings may drop from 8.79M to 8.73M.

Poor economic figures should weaken the greenback. On the contrary, positive data could punish the price of gold.

Tomorrow, the Australian CPI q/q may report a 0.8% growth after a 1.2% growth in the previous reporting period, while CPI y/y is expected to register a 3.7% growth. Lower inflation could boost the XAU/USD.

Furthermore, the US ADP-Non Farm Employment Change could drop from 164K to 145K, the Employment Cost Index could report a 1.0% growth, while Chicago PMI may jump to 47.9 points.

Still, the most important event of the week is represented by the FOMC. The Federal Funds Rate should remain at 5.50% but the FOMC Press Conference and FOMC Statement should bring sharp movements.

Gold Price Technical Analysis: Retesting Downtrend Line

As you can see on the hourly chart, the price jumped above the downtrend line after retesting the lower median line (lml) of the ascending pitchfork, signaling an upside continuation.

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The bias is bullish in the short term as long as it stays above the lower median line (lml). In the short term, the rate could retest the broken downtrend line before extending its growth.

A new higher high validates more gains ahead. Only failing to stay above the downtrend line may invalidate the upside scenario.

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• Source: https://www.forexcrunch.com/blog/2024/01/30/gold-price-breakout-needs-confirmation-fomc-eyed/