Investors are looking for economic data insights on rising interest rates in the face of persistent inflation as gold prices (XAU) decline as the US currency strengthens.

Highlight
Gold costs decline when the value of the dollar rises.
The belief that central banks will stop raising interest rates increases gold demand.
For upcoming Fed rate decisions, employment data in the US is essential.

Overview

Tuesday witnessed a modest decline in gold (XAU) prices as the value of the dollar increased. Investors were looking for hints regarding the timeline of increased interest rates in reaction to persistent inflation, so all eyes were on the next economic data.
Rate-Peak Speculation Fueled the 2.3% Increase Last Month
Gold prices enjoyed a solid month in July, rising by 2.3%, the largest monthly gain in the previous four months. Expectations that the cycle of rate rises by central banks across the world would soon end fuelled this rally. Gold is a desirable investment because of the tendency for lower interest rates to increase demand for zero-yield bullion.
Technical Difficulties, Weighing Powell’s Comments
The recent comments from Jerome Powell served as a warning that the market could have overreacted to a few disappointing U.S. economic data points, but the rise now confronts technical resistance. Austan Goolsbee, president of the Chicago Federal Reserve, highlighted that the central bank is taking precautions in order to reduce inflation without starting a recession. The strategy continues to be data-dependent, and September will be important for determining if more monetary tightening is necessary.
Global central banks are keeping a careful eye on the inflation situation in the hopes of a quick deflationary trend. They adopt a conservative position because of their emphasis on data-driven decision-making.
Investors Are Watching US Employment Data
U.S. employment statistics will be crucial in determining how people will react to the Federal Reserve’s upcoming interest rate hikes in the days to come. Any good surprises in the employment statistics may serve as a reminder that another rate hike is still conceivable, which would put pressure on gold prices.

The negative effects of a stronger dollar
A recent Fed poll found that U.S. banks tightened credit rules and faced decreased loan demand from businesses and individuals during the second quarter, which is another factor that the strong U.S. currency contributed to gold’s drop.
Outlook for the Near Term: Downward to Lower
In conclusion, based on economic data and pronouncements from central bank officials, gold prices may endure brief changes. To better assess the prognosis for gold prices in the near future, investors should closely monitor employment statistics and the Fed’s actions.

Technical Analysis
The short-term market mood for gold (XAU/USD) looks to be conflicted. The price is currently above the 200-4H moving average at 1955.49, indicating a bullish trend. However, the price is only a little under the 1963.26 50-4H moving average, suggesting a possible bearish signal. With a 14-4H RSI value of 45.03, momentum is neutral to down.
The price is now above this range, offering some support. The key support area is between 1942.50 and 1948.25. However, the key resistance region, which is between 1979.00 and 1987.53, may serve as a roadblock to further upward advance.
The key resistance region and the 50-4H moving average should be actively watched by traders for any potential changes in the market’s direction. The technical indicators’ conflicting signals point to short-term uncertainty for Gold (XAU/USD).

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