FundamentalOverview

Gold continues to correctlower as the market unwinds some of the stagflationary risk that was priced inin the past months. The de-escalation trend will likely remain intact until thefirst trade deal.

The stagflationary pricing iswhat got gold to such high prices, and as we start to price out that risk, it’snormal to see a correction, especially considering that “long gold” has beenthe most crowded trade.

In the bigger picture, goldremains in an uptrend as real yields will likely continue to fall amid Fedeasing. But in the short-term more positive news on the tariffs front should seemore downside for gold as the market readjusts to new conditions.

GoldTechnical Analysis – Daily Timeframe

On the daily chart, we cansee that gold broke out of the recent range to the downside as the marketcontinues to reprice the stagflationary risks. From a risk managementperspective, the buyers will have a better risk to reward setup around the previoushigh at 3167 to position for further upside, while the sellers will look for abreak lower to increase the bearish bets into the major trendline around the3100 level.

Gold Technical Analysis– 4 hour Timeframe

On the 4 hour chart, we cansee more clearly the breakout of the range between the 3258 support and the3367 resistance. We now have a downward trendline defining the bearishmomentum. The sellers will likely step in around the broken support and thetrendline to position for further downside, while the buyers will want to seethe price breaking higher to target the 3367 level next.

Gold Technical Analysis– 1 hour Timeframe

On the 1 hour chart,there’s not much else we can add here as the sellers will likely step in bothat the broken support and the trendline, while the buyers will pile in at everybreak higher. The red lines define the average daily range for today.

UpcomingCatalysts

Today we get the latest US Jobless Claimsfigures and the US ISM Manufacturing PMI. Tomorrow, we conclude the week withthe US NFP report.