Gold prices eased on Wednesday as investors turned their attention to upcoming US inflation data for clues on the Federal Reserve’s interest-rate path, although technical indicators continued to support a bullish outlook.
Spot gold fell 0.6% to US$4,626.79 an ounce by 6.25am GMT, after hitting its highest level since mid-May in the previous session. US gold futures also edged 0.2% lower to US$4,683.60.
The pullback came as markets awaited the US Personal Consumption Expenditures (PCE) price index for July, the Fed’s preferred inflation gauge, which is due later today. Investors are also watching Fed Chairman Kevin Warsh’s speech at the Jackson Hole symposium on Friday.
RHB Investment Bank Bhd (RHB Research) maintained its bullish view on COMEX gold following mild profit-taking during Tuesday’s session, when the commodity fell US$3.20 to close at US$4,658.20.
RHB Research noted that while COMEX gold formed a bearish candlestick, it remained above its 20- and 50-day simple moving averages, while the Relative Strength Index continued to point upwards, suggesting that bullish momentum remains intact.
The research house expects gold to resume its upward movement and test the US$4,800 level, with US$4,500 identified as the immediate support level.
RHB Research retained its recommendation to maintain long positions initiated at US$4,273.30, with a stop-loss at US$4,300. The next upside resistance levels are seen at US$4,800 and US$4,900.
Meanwhile, Reuters technical analyst Wang Tao said spot gold could retest resistance at US$4,681, with a break above that level potentially opening the way towards US$4,707 to US$4,743.
Among other precious metals, spot silver rose 0.2% to US$68.75 an ounce, platinum gained 0.3% to US$1,863.58 while palladium advanced 0.7% to US$1,335.54.
