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Gold Price Retreats Ahead of Critical US Data, Eyes Inflation Cues

Gold price (XAU/USD) experiences selling pressure as it struggles to hold above $2,320 in anticipation of crucial US macroeconomic releases. Diminishing safe-haven demand due to easing geopolitical tensions and investor caution weigh on the precious metal.

Key Factors:

  • Focus on US GDP and PCE Data: Thursday’s Q1 Gross Domestic Product (GDP) release and Friday’s core Personal Consumption Expenditure (PCE) Price Index, the Fed’s preferred inflation gauge, hold pivotal importance for Gold’s trajectory.
  • Inflation Expectations: Hotter-than-expected inflation data could trigger a Gold sell-off as the Fed gains further justification to maintain higher interest rates for longer.
  • USD & Bond Yield Impact: Persisting inflationary pressures strengthen the US Dollar and boost bond yields, adversely affecting Gold’s appeal.

Technical Analysis: Gold Vulnerable Below $2,300

  • Technical Weakness: Gold struggles to sustain gains above $2,300, signaling potential downside risk. The 20-day EMA ($2,313) acts as a crucial support level.
  • Key Support: A break below the three-week low near $2,265 could open the door to March 21 high at $2,223.
  • RSI Indicator: The Relative Strength Index (RSI) falling below 60.00 points to waning bullish momentum. However, a sustained hold above 40.00 maintains the longer-term upside bias.