Article by: ETO Markets

US will issue the Consumer Price Index data for April. Despite using a separate inflation indicator to inform its monetary policy decisions, the Federal Reserve will probably take action on any departure in FX prices. Meanwhile, the negative news is difficult for US indexes to overcome. The Nasdaq Composite is up about 40 points, while the Dow Jones Industrial Average, S&P 500, and other indexes are hovering around their starting marks. The way stocks are acting indicates that market participants are not very concerned about the numbers, and this lowers demand for safe-haven gold.

Any further purchases above the May 10 high of $… might pave the way for a surge to the next significant resistance level, which is located close to the psychological $… barrier. A clear break above the indicated level will reveal an all-time high close to $… on the way to the $… round number.

Conversely, the crucial support level for gold will appear near $…, which is the intersection of the 100-SMA, the lower bound of the declining trend channel, and a low from May 13. If this level is broken, there will be a decline to the $… round number and a low of $… on May 3.