The USD was supported by aggressive Fed rate hike bets and some pressure.
A bearish flag pattern indicates more weakness ahead.
The Gold Price is trying to rebound from its two-month lows at $1,886, closing in at $1,900 this Wednesday. Despite the ongoing EU-Russian energy conflict and the ongoing Ukraine war, the market mood is positive. The improving sentiment is helping to pull the US dollar back from its two-year highs. This provides a welcome respite for XAUUSD bears. The rebound in non-yielding Gold Price is also helped by the negative sentiment around US Treasury yields.
Despite the dollar's retreat, persistent concerns about global growth, China’s lockdowns, and aggressive Fed rate hikes will likely keep the greenback in demand, which could limit gold’s recovery. According to the CME Fed watch instrument, Fed will likely raise rates half a percent at each of its next two meetings. According to the economic indicators, the economy has moved beyond the restrictive policy environment. A tight stance on liquidity will continue to be the talk of town. This was seen as a major factor that acted against the non-yielding yellow gold.
In the future, the USD will be influenced by the wider market sentiment and Fed expectations, even if there are no top-tier US economy releases. Investors are also focusing on Thursday's US Gross domestic Product (GDP). An initial estimate of the US GDP at 1.1% suggests a lower performance than the 6.9% prior print.Date Of Update: 30 July 2022, 06:25