The gold price climbed as high as $1,970 in the last trading session. The metal has retreated a little and is trading around $1,965 while writing.

The yellow metal rallied in the short term as the US dollar slipped. Fundamentally, the United States economic data came in worse than expected yesterday, boosting the XAU/USD.

The Unemployment Claims indicator jumped to 261K in the last week, above the 236K forecast and far above 233K in the previous reporting period. In contrast, the Final Wholesale Inventories indicator registered a 0.1% drop compared to the 0.2% drop estimated.

Today, the Chinese Consumer Price Index reported a 0.2% growth matching expectations and beating the 0.1% growth in the previous reporting period.

In addition, the PPI registered a 4.6% drop compared to the 4.3% drop forecasted and after the 3.6% drop in April.

Later, the rate could be driven by the Canadian economic figures. The Unemployment Rate could jump to 5.1% from 5.0%. Employment Change is expected at 21.2K versus 41.4K in the previous reporting period, while the Capacity Utilization Rate could be reported higher at 82.0%.

Gold price technical analysis: Strong bullish pressure

(Click on image to enlarge)

Gold price hourly chart

From the technical point of view, the XAU/USD found resistance at the $1,969 historical level after reaching the median line (ml) of the ascending pitchfork.

After such an impressive rally, a corrective downside can be expected. Still, the current retreat could represent a flag pattern. This could represent an upside continuation pattern.

The weekly pivot point of 1,954 represents the first downside obstacle. Staying near the resistance levels may announce an imminent breakout and continuation.

More By This Author:

AUD/USD Outlook: Recession Risks Rise After RBA Hike
USD/CAD Forecast: Rising Oil Prices To Support CAD
AUD/USD Weekly Forecast: RBA to Hike Rates Amid Hotter CPI