Gold price (XAU/USD) has been dumped heavily by market participants as Federal Reserve (Fed) policymakers reiterate their hawkish stance on the interest rate outlook. The precious metal continues its three-day losing spell as bets for unchanged interest rates fade amid a resilient US economy. The US Dollar attracts significant bids as strong consumer spending and tight labor market conditions may keep excess inflation persistent.
In August, demand for Durable Goods remained upbeat as business spending on equipment increased. It seems that optimism among US firms is returning as traders see no more interest rate hikes from the Fed this year. For more clues about the inflation outlook, investors await the Fed’s preferred Core Personal Consumption Expenditure (PCE) Price Index data for August, which is scheduled for Friday.
Gold price forms consecutive bearish Marubozu candlesticks on the daily timeframe. This indicates that each pullback in Gold price has been considered as selling opportunities by market participants. The precious metal stabilizes below the 200-day Exponential Moving Average (EMA), which trades around $1,910.00, indicating that the broader trend has turned bearish. Momentum oscillators shifted into the bearish territory, warranting more weakness ahead.