Gold prices rise in the ascending channel
Spot gold prices have stalled in the past 24 hours, halting the aggressive rise seen earlier this week. The anti-fiat yellow metal tends to reverse the yields of the US dollar and the Treasury. The greenback stabilized after Wednesday’s losses. Yields on US government bonds remained depressed towards the longer maturities. Entry rates were slightly higher.
The Hawkish Federal Reserve’s monetary policy expectations have stabilized somewhat since the start of the week. More than one rate hike by the end of next year has now been incorporated, but the chances of a second have stopped increasing. This has probably given XAU / USD some breathing space lately. Non-interest bearing assets tend to perform poorly when returns on fixed income assets rise.
In the remaining 24 hours, gold will closely monitor US retail sales and University of Michigan sentiment data. While results continue to surprise overall on the downside, it has been by an increasingly narrow margin since mid-September. Nonetheless, a negative result could hamper hawkish bets from the Fed, providing additional upside for the yellow metal.
Gold technical analysis
On the four hour chart below, gold appears to be trading higher since late September within an ascending channel. Its latest ceiling test could warn that the next stage of the uptrend is lower. This also follows a negative RSI divergence, showing that the bullish momentum is fading. A downward turn could put emphasis on the 20-day simple moving average for support.