Investors and traders alike pay close attention to US Consumer Price Index (CPI) data as it serves as an indicator of inflation and price stability in the world’s largest economy. Higher CPI readings often prompt central banks to tighten monetary policy, which can lead to higher interest rates and a stronger US dollar. As a result, the impact of higher CPI data on gold prices, such as the XAUUSD pair, can be significant.
Today’s given signal : https://t.me/calendarsignal/10870
When the US CPI data is released and shows higher than expected increases, it typically triggers a round of selling pressure on gold prices. Investors and speculators tend to sell their gold positions to lock-in profits or protect against potential inflation risks. This selling pressure intensifies as gold prices reach overbought levels, indicating excessive optimism among market participants.
The combination of higher US CPI data and overbought gold prices creates a bearish environment for the XAUUSD pair. As gold prices decline, the US dollar tends to appreciate, further exacerbating the selling pressure on the pair. This dynamic is driven by the perception that gold, as an inflation hedge, loses its appeal when inflation expectations fall or the US dollar strengthens.
Traders and investors should be cautious when trading XAUUSD during such periods. A higher US CPI reading combined with overbought conditions can prompt significant selling pressure, leading to potential losses for those who hold long positions. It is essential to closely monitor price movements and technical indicators such as Relative Strength Index (RSI) and Moving Averages (MAs) to identify potential turning points and exit trades accordingly.
Previous released data results :
On last CPI data (13-2-2024) we predict to BUY XAUUSD as for lower CPI Data price was raised.
Check the previous blog : https://blog.forextrade1.com/the-impact-of-us-cpi-on-xauusd-pair-13-2-2024/
Check last given signal : https://t.me/calendarsignal/10511
Performance :
