Gold Price Forecast: XAU/USD Short-Term Outlook Remains Positive Amidst Mixed Economic Data

Highlights

• XAUUSD up 0.32% to $2,009.32/oz
• Mixed economic data led investors to reconsider Fed’s plans
• XAUUSD’s safe-haven status supported by global tensions

Overview

On Monday, XAUUSD is edging slightly higher, although it is lower than the one-year highs achieved at the end of last week.

Mixed economic data led investors to reconsider the U.S. Federal Reserve’s plans for raising interest rates, which, in turn, strengthened the dollar.

As of 05:48 GMT, the spot XAUUSD is up by 0.32% to $2,009.32 per ounce, while U.S. gold futures increased by 0.38% to $2,023.40. However, the dollar index also rose by 0.1%, which made it more expensive for foreign buyers to purchase bullion.

XAUUSD is expected to trade with a positive bias, but it may experience some initial correction. However, there is no anticipation for a major decrease in prices, as the current uncertain global economic and geopolitical tensions continue to support its safe-haven status.

US Economic Data Weighs on XAUUSD Price

On Friday, XAUUSD experienced a 2% drop following the release of data showing a 0.3% slip in U.S. core retail sales last month. Nevertheless, gains in January and February suggest that consumer spending is on track to accelerate in the first quarter. Moreover, a separate report revealed that households expect inflation to increase over the next 12 months, while U.S. factory production fell in March but managed to make a modest gain in the first quarter.

The price of XAUUSD is closely linked to real yields, and the market is sensitive to U.S. inflation and employment data.

Technical Analysis

From a technical view, according to the daily chart, XAUUSD is trading above the moving average at $1803.64, supported by a positive RSI indicator. The technicals appear to be in favor of an upside and a potential test of that $2.045.30 price. If the price does not reach its peak and instead has a downward trend, we may witness a decline toward the $1927.36 region.

Resistance and Support Lines: 

Short-Term Outlook

It seems that XAU Gold is likely to continue trading with a positive bias in the short term. Despite a slight drop on Friday, XAUUSD has edged slightly higher on Monday, and the uncertain global economic and geopolitical tensions continue to support its safe-haven status.

Furthermore, technical indicators suggest a potential upside towards the $2,045.30 price level, supported by XAUUSD’s current position above the moving average and a positive RSI indicator. However, if the price does not reach this peak, we may witness a decline towards the $1,927.36 region.

Overall, XAU Gold’s short-term outlook appears positive, but as always, unforeseen economic and geopolitical events can impact the market’s direction.

For a look at all of today’s economic events, check out our economic calendar.