Gold was trading in the green at the 1,798 level at the time of writing. The bias was bullish before the US data dump and remained bullish after the US high-impact economic data. XAU/USD is trapped within an ascending channel, so further growth is still in cards.
Fundamentally, the US inflation data brought high volatility and sharp movements. As you already know, the USD depreciated after the CPI rose by 0.0% in July versus 0.2% expected, while the Core CPI registered a 0.3% growth less compared to the 0.5% estimated. The yellow metal took advantage of this situation and it has rallied.
Lower than expected inflation could help the FED stop hiking rates in the future. The Final Wholesale Inventories rose by 1.8% versus 1.9% expected. Tomorrow, the US PPI, Core PPI, and the Unemployment Claims could bring more volatility.
XAU/USD Up-Channel Intact!
The price of Gold rallied after retesting 1,788. It has climbed as much as 1,807 where it has found resistance. Technically, it has registered only a fasle breakout through 1,805, and now it could come back to test and retest the uptrend line and 1,788.
As long as it stays above the uptrend line, XAU/USD could try to resume its growth. Still, the price action signaled exhausted buyers after failing to reach and retest the channel's upside line.
XAU/USD Outlook!
Staying above 1,788 and above the uptrend line followed by a valid breakout above 1,805 could activate further growth and could bring new long opportunities.
On the other hand, a valid breakdown below the uptrend line could signal a deeper drop.
