As the DXY extends its losses, the gold price is accelerating towards $1,680.00.
The DXY was weakened by a third consecutive decline in US GDP figures.
The core PCE price index in the United States is expected to rise by 10 basis points to 4.7%.
The gold price (XAU/USD) is aiming to breach the critical $1,680.00 level amid ongoing weakness in the US dollar index (DXY). After sustaining above $1,650.00, the precious metal extended its recovery and is expected to remain in the grip of bulls in the near future. The yellow metal completed its corrective move towards $1,640.00 and strengthened after the US GDP remained in line with projections.
The annualised US GDP has been falling for three straight quarters by 0.6%. The effects of the Federal Reserve’s (Fed) larger rate increases appear to be beginning to manifest themselves. Bets on a potential US recession situation were rising, but they quickly disappeared after Mary Daly’s remarks from the San Francisco Fed.
Notably, the 50- and 200-period Exponential Moving Averages (EMAs) of gold prices have been crossed whereas the EMAs have not yet shown a crossing. This indicates how strong the upward momentum is.
Additionally, the Relative Strength Index (RSI) (14), which shows a continuation of upward momentum, has moved into the positive range of 60.00-80.00.
