Current trend

The quotes of the XAU/USD pair are currently testing the 1937.50 level (Murray level [2/8]).

The current dynamics is associated with the emergence of prerequisites for the completion of the cycle of tightening the monetary policy of the US Fed. At the June meeting, the regulator has already suspended the interest rate increase at the level of 5.25% and, against the background of the latest economic data, may continue to hold it at this level. June statistics from the US labor market confirmed the beginning of its cooling, as employment in the country seriously slowed down growth from 306.0K to 209.0K. Today, investors will be watching the June data on inflation in the USA: the consumer price index is likely to decline from 4.0% to 3.1% on an annualized basis, and the base annual value – from 5.3% to 5.0%. Commenting on the current situation, US Fed officials are still inclined to the need to resume raising the interest rate, but even in this case they assume a less significant adjustment (perhaps by 10 basis points instead of 25 basis points). In addition, the head of the department Jerome Powell hinted that the regulator could curtail the current monetary rate if necessary. This market situation allows experts to assume that the transition to a long-term retention of the value at the current level is already close, which strengthens the positions of assets alternative to the US currency.

Support and resistance

The price has risen above the middle line of the Bollinger Bands and is now trying to consolidate above the 1937.50 mark (Murray level [2/8]). If successful, the growth of quotations will continue to the levels of 1968.75 (Murray level [3/8]) and 2000.00 (Murray level [4/8]). The key for the "bears" remains the level of 1906.25 (Murray level [1/8]), its breakdown will allow the price to resume the downward dynamics to the area of 1875.00 (Murray level [1/8]).

Technical indicators do not give a single signal: the Bollinger Bands are directed down, the Stochastic is directed upwards, the MACD histogram is decreasing in the negative zone.

Resistance levels: 1937.50, 1968.75, 2000.00.

Support levels: 1906.25, 1875.00.

Trading tips

Long positions can be opened above 1937.50 with targets at 1968.75, 2000.00 and stop-loss in the area of 1916.00. Implementation period: 5-7 days.

Short positions should be opened below 1906.25 with a target at 1875.00 and stop-loss in the area of 1928.70.