The Price of Gold XAU/USD Shows Strongest Fall in Almost 2 Years

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On Monday, the price of gold fell from USD 2,386 to USD 2,333 per ounce — this is the strongest drop in one day in almost 2 years, according to Bloomberg. On Tuesday morning in the Asian session, the price continued to decline, reaching USD 2,300 per ounce.

This happened against the backdrop of:

→ easing tensions in the Middle East. According to Tehran's official statement, Israel received "the necessary response at this stage."

→ signs that the Federal Reserve will keep rates high for longer.

One of the reasons for the intensification of sales can also be considered the desire to take profits by those who held long positions — we wrote about this in the post “The price of gold XAU/USD has reached an important resistance zone” on April 16.

Nevertheless, the gold market continues to remain in an upward trend — since the beginning of the year, its price has increased by 11.5%.

Technical analysis of the XAU/USD chart shows that:

→ the price of gold has reached the median line of the ascending channel (shown in blue), which has been in effect since the beginning of the year;

→ the indicated median line is located in the area of the psychological mark of USD 2300 per ounce — so this area can support the price of gold today.

It is possible that the bulls will try to win back at least 50% of the fall, raising the price to USD 2,350. How successful they will be will depend, among other things, on the fundamental data background. On Friday at 15:30 GMT+3 the values of the Core PCE Price Index will be published — an indicator that the Federal Reserve pays special attention to when analyzing current inflation in the United States.

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This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

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