Gold price sticks to intraday losses amid modest USD uptick, holds above $2,400 mark

• 
  Gold
  price
  drifts
  lower
  and
  reverses
  a
  part
  of
  Thursday’s
  softer
  US
  CPI-inspired
  positive
  move.
• 
  An
  uptick
  in
  the
  US
  bond
  yields
  revives
  the
  USD
  demand
  and
  exerts
  pressure
  on
  the
  XAU/USD.
• 
  Rising
  September
  Fed
  rate
  cut
  bets
  should
  act
  as
  a
  tailwind
  for
  the
  metal
  and
  help
  limit
  losses.

Gold
price
(XAU/USD)
rallied
to
the
$2,424-2,425
area
on
Thursday,
or
its
highest
level
since
May
22
in
reaction
to
another
tame
US
inflation
report,
which
boosted
expectations
that
the

Federal
Reserve
(Fed)
will
cut
interest
rates
in
September.
That
said,
a
goodish
pickup
in
the
US
Treasury
bond
yields
assists
the
US
Dollar
(USD)
in
moving
away
from
a
nearly
three-month
low
set
on
Thursday
and
prompts
some
selling
around
the
non-yielding
yellow
metal
during
the
Asian
session
on
Friday.
Apart
from
this,
the
underlying
bullish
sentiment
surrounding
the
equity
markets
is
seen
as
another
factor
driving
flows
away
from
the
safe-haven
precious
metal. 

Gold
price,
for
now,
seems
to
have
snapped
a
three-day
winning
streak,
though
any
meaningful
corrective
downfall
still
seems
elusive
in
the
wake
of
firming
expectations
that
the
Fed
will
start
its
rate-cutting
cycle
sooner
rather
than
later.
Adding
to
this,
geopolitical
risks,
political
uncertainty
in
the
US
and
Europe,
along
with
concerns
about
a
global
economic
slowdown,
should
continue
to
act
as
a
tailwind
for
the
XAU/USD,
warranting
some
caution
for
bears.
Traders
now
look
forward
to
the
release
of
the
US
Producer
Price
Index
(PPI)
and
the
University
of
Michigan
Consumer
Sentiment
survey
for
a
fresh
impetus
later
during
the
North
American
session. 

Daily
Digest
Market
Movers:
Gold
price
is
weighed
down
by
reviving
USD
demand,
downside
seems
limited

• Gold
  price
  surged
  past
  the
  $2,400
  mark
  on
  Thursday
  following
  the
  release
  of
  the
  softer-than-expected
  US
  consumer
  inflation
  figures,
  which
  lifted
  bets
  for
  a
  September
  interest
  rate
  cut
  by
  the
  Federal
  Reserve.
• The
  US
  Bureau
  of
  Labor
  Statistics
  (BLS)
  reported
  that
  the
  headline
  Consumer
  Price
  Index
  (CPI)
  dipped
  in
  June
  for
  the
  first
  time
  in
  more
  than
  four
  years
  and
  the
  yearly
  rate
  decelerated
  to
  3%
  from
  3.3%
  in
  May. 
• Meanwhile,
  the
  core
  CPI,
  which
  excludes
  volatile
  food
  and
  energy
  prices,
  was
  up
  0.1%
  during
  the
  reported
  month
  and
  rose
  3.3%
  YoY,
  also
  missing
  consensus
  estimates
  and
  the
  3.4%
  increase
  registered
  in
  May. 
• Investors
  were
  quick
  to
  react
  and
  are
  now
  pricing
  in
  over
  a
  90%
  chance
  that
  the
  Fed
  will
  lower
  borrowing
  costs
  at
  the
  September
  monetary
  policy
  meeting,
  as
  indicated
  by
  the
  CME
  Group’s
  FedWatch
  Tool.
• Furthermore,
  the
  December
  2024
  fed
  funds
  rate
  futures
  contract
  implies
  that
  the
  US
  central
  bank
  will
  cut
  policy
  rates
  by
  49
  basis
  points
  (bps)
  toward
  the
  end
  of
  the
  year,
  up
  from
  39
  bps
  a
  day
  ago.
• San
  Francisco
  Fed
  President
  Mary
  Daly
  acknowledged
  improving
  inflation
  figures
  and
  said
  that
  the
  economy
  looks
  to
  be
  on
  a
  path
  where
  one
  or
  two
  rate
  cuts
  this
  year
  would
  be
  more
  or
  less
  appropriate.
• Separately,
  St.
  Louis
  Fed
  President
  Alberto
  Musalem
  noted
  that
  recession
  risks
  remain
  low,
  and
  the
  disinflation
  process
  is
  ongoing,
  though
  policymakers
  would
  like
  to
  see
  more
  progress.
• Meanwhile,
  the
  yield
  on
  the
  benchmark
  10-year
  US
  government
  bond
  tumbled
  to
  its
  lowest
  level
  since
  March,
  dragging
  the
  US
  Dollar
  to
  a
  three-month
  trough
  and
  providing
  a
  strong
  boost
  to
  the
  yellow
  metal.
• This
  overshadowed
  the
  better-than-expected
  release
  of
  the
  US
  Initial
  Jobless
  Claims,
  which
  fell
  to
  222K
  for
  the
  week
  ending
  July
  6
  as
  compared
  to
  expectations
  for
  a
  reading
  of
  236K
  and
  the
  239K
  previous.
• The
  XAU/USD,
  however,
  struggles
  to
  capitalize
  on
  the
  overnight
  strong
  move
  up
  amid
  a
  modest
  USD
  uptick
  during
  the
  Asian
  session
  on
  Friday,
  though
  the
  fundamental
  backdrop
  favors
  bullish
  traders.

Technical
Analysis:
Gold
price
could
find
decent
support
near
and
attract
dip-buyers
near
the
$2,390-2,388
area

From
a
technical
perspective,
the
overnight
sustained
breakout
through
the
$2,400
mark
was
seen
as
a
fresh
trigger
for
bullish
traders.
Moreover,
oscillators
on
the
daily
chart
have
been
gaining
positive
traction
and
are
still
away
from
being
in
the
overbought
territory.
This
further
validates
the
near-term
positive

outlook
for
the
Gold
price,
suggesting
that
any
meaningful
slide
might
be
seen
as
a
buying
opportunity
and
remain
limited. 

Some
follow-through
selling
below
the
$2.388-2.387
horizontal
resistance
breakpoint,
now
turned
support,
could
drag
the

XAU/USD
towards
the
$2,358
region
with
some
intermediate
support
near
the
$2,372-2,371
area.
On
the
flip
side,
the
overnight
swing
high,
around
the
$2,425
region
now
seems
to
act
as
an
immediate
hurdle,
above
which
the
Gold
price
is
more
likely
to
aim
back
towards
challenging
the
all-time
peak,
around
the
$2,450
region
touched
in
May.