Gold prices fell after the CPI data and surged afterward

[FXOcrypto]

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Gold prices soared and reached a new all-time high yesterday. The price has formed a new all-time high at $2379 before rebounding to $2376.
On Wednesday the CPI data provided support for the strengthening of the dollar where the actual value of the CPI was 0.04% higher than the expected value of 0.03%.

After the CPI was released, many USD pairs weakened against the US dollar, including gold which fell to $2319 from $2360. The strengthening of the USD did not seem to last long, because the price of gold then soared and made investors smile because the price soared then. The price of gold is back to recording a new all-time high throughout 2024 at $2379.

XAUUSD technical analysis today
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Gold price is currently trading at $2375. The price formed a long-body bullish candlestick reflecting a strong rally.
On the daily timeframe, gold prices move near the upper band line. Here the Bollinger bands form an upward channel with expanding bands indicating an uptrend market with high volatility.

MA 50 forms an ascending channel near the lower band line indicating an uptrend market. Meanwhile, the RSI shows level 81, meaning the price is moving in the overbought zone.

On the H1 timeframe the price moves near the upper band line. Bollinger bands appear to be expanding, reflecting increased market volatility.
MA 50 forms a flat channel in this time frame near the middle band line reflecting a sideways market. MA often acts as a lagging indicator.
On the other hand, the RSI shows level 74, meaning the price is moving in the overbought zone

 

[Riberet19]

I think the price of gold may be telling us that big banks and investors are taking refuge in this asset because something big is coming, perhaps in the medium or long term, this is definitely not good.

 

[FXOcrypto]

That's right, I think so, previously several central banks were reported to have started buying gold as reserves, perhaps they had anticipated the possibility of global economic uncertainty early on, and the sharp decline that occurred could have been due to profit-taking by large institutions. In the long-term time frame, it is expected to remain bullish

 

[Nicky77]

The fluctuation in gold prices, initially dropping post-CPI data release, followed by a subsequent surge, highlights the metal's sensitivity to inflation indicators. This dynamic underscores investors' reactions to economic data, as they gauge inflationary pressures. The dip likely reflects immediate market response to perceived stability, while the subsequent surge may signify renewed concerns over inflation, prompting investors to seek refuge in gold as a hedge against currency devaluation.

 

[FXOcrypto]

Gold fluctuations are very high and vulnerable to inflation data, often correlating with the USD, the Fed's policies related to interest rates are usually a concern for gold. When interest rates are still high hence market interest in gold may decrease because they are looking for higher yields.