Gold has been dragged back below the psychologically-important $1800 mark after the US economy’s latest show of resilience.
In light of the lower-than-expected weekly initial jobless claims as well as the upward revision to the US Q3 GDP figure, such data appears to pave the way for more incoming Fed rate hikes – the prime adversary for gold bulls.
Still, that isn’t stopping gold prices from attempting to resurface above the psychological $1800 once more, as it continues adhering to its uptrend that began in early November.
With its 21-day simple moving average (SMA) crossing above its 200-day counterpart just recently, such a bullish technical event may also herald more incoming gains for the precious metal.
Such hopes however may have to rely on spot gold’s 200-day SMA acting as critical support.
Gold bugs may have to bide their time, waiting for the next iteration of the “Fed pivot” narrative to take stronger hold of the markets.
The next leg down for the US dollar should send spot gold onto a new cycle high past $1824.50.
Ultimately, the precious metal is likely to churn its way higher as long as market participants are allowed to continue chipping away at the Fed’s supposed hawkishness.
Traders and investors should keep bullion well bid going into 2023, as markets brace for the prospects of a US recession and the accompanying Fed pivot.