• Gold hovers near $1,910 per ounce, close to three-month low amid hawkish Federal Reserve rhetoric.
• Persistent inflation strengthens case for 25bps rate hike in upcoming Fed meeting.
• Core PCE price index rises by 4.6% annually, underscoring stickiness in inflation.
• Fed Chair Powell expects gradual measures to bring inflation back to 2% target.
• European Central Bank and Bank of England tighten policy, signaling commitment to combat inflation.

The Gold Futures contract is currently trading within a balanced price range, suggesting that traders are relying on the upper extreme for potential downside rotational scenarios. This indicates a possible strengthening dollar, which could pressure the price of gold. However, any indications of a looming recession may be viewed as bullish for the safe-haven asset.

Looking at the weekly performance, the market showed minimal changes compared to the previous week, closing at approximately $1929 per ounce. It is worth noting the presence of buying tail, indicating absorption and potential core long buyers. This could lead the market to target the macro bracket highs, contingent upon the trajectory of monetary policy. The prevailing global hawkish rhetoric and higher interest rate pressures are likely to influence the long-term perspective of gold.

In the previous session, the market closed with gains of about 0.6%, targeting the swing highs and upper range of the previous balanced price range. Any pullbacks in the lower periodicities could be an opportunity to add to core long positions established during Thursday’s and Friday’s sessions.

Medium- to long-term calculations for gold point to mixed indications, with stronger negative volatility suggesting the potential for higher gold prices in the long run.

From a yearly VWAP perspective, the price is currently trading below the developing value, which is calculated around $1946. This presents a potential target for sellers, while the lower value extreme around $1883 may attract additional core long buyers. The slight upside-to-flat slope of the value area indicates a potential balanced rotational behavior within this specific range. It is important to note the supportive nature of the prior year’s upper value close level, which prompted core buying.

When analyzing the volume profile of the closing month, we can observe a double distribution profile characterized by multiple low volume nodes, indicating potential resistance to an upward movement. The presence of a low volume area in the middle of the month’s price range suggests that it may serve as a target to be filled in the following month and could act as a selling zone. Additionally, considering the market’s considerable distance from the point of control (POC), it is more likely that a retest of this particular level will occur.

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