After rebounding from a short-term major support line, the price of gold (XAU/USD) is still capped at $1,671 during Thursday’s Asian session. As a result, the precious metal simulates the typical pre-data trade slowdown before to the release of the US Consumer Price Index (CPI) data for September.

According to relevant reports, this week, gold prices fell as a result of the Federal Reserve sending out more hawkish signals and rising demand for the dollar as a safe haven currency. The markets are currently anticipating important U.S. CPI inflation data that will be released later today in order to gain additional insight into the direction of U.S. monetary policy. The reading is anticipated to demonstrate that in September, inflation stayed close to 40-year highs.

It’s important to note that the US Producer Price Index (PPI) published 8.5% YoY statistics for September, vs 8.4% predicted and 8.7% previously. If the CPI figures don’t show the anticipated decrease, this predicts further downside for the XAU/USD. Forecasts indicate that the headline CPI will decline to 8.1% YoY from 8.3% in the prior year, while the more significant CPI ex-Food & Energy is predicted to rise to 6.5% YoY from 6.3% in the prior year and could lead to more fall given the recession’s difficulties, reported by Fx Street.

The Fed’s September meeting minutes, which were made public on Wednesday, revealed that policymakers unanimously decided to tighten monetary policy and are likely to maintain high interest rates for an extended length of time as the central bank tries to reduce inflation, reported by investing.com.

Technically speaking, the bears on gold futures have a significant near-term technical advantage. The next upward price target for bulls is to achieve a close above the strong resistance level of the October high of $1,738. The next short-term downside price target for bears is to drive futures prices below strong technical support at the $1,622 low from September, reported by Kitco News.

Therefore, with gold is downtrend in the technical daily chart, playing between $1,660 to $1,691. First resistance is seen at Monday high of $1683, $1691 and then at $1,700. First support is seen at this week’s low of $1,660 and then at $1,654.

Analyst: Ms.Teang Riya, Independent Analyst