Gold Struggles Above $4,000 as Brent Crude Surpasses $100 and Rate Hike Odds Jump
On July 24, gold prices hovered around $4,028 as they struggled to maintain their position above the $4,000 psychological support level. Brent Crude oil prices had risen above $100 per barrel for the first time since May, contributing to inflation concerns and increasing the likelihood of a September Fed rate hike to 80%. This has put pressure on gold, with many experts expecting it to fall further.
The World Gold Council reported that central banks bought 41 net tonnes of gold in May, with Poland, China, Uzbekistan, Kazakhstan, and Singapore among the top buyers. However, despite this strong demand, gold is still facing significant headwinds due to macroeconomic factors.
Gold's technical analysis suggests that it has broken below key moving averages, with significant support at $4,000. If this level fails, gold could drop to $3,964. The Relative Strength Index (RSI) is also close to oversold levels, indicating a potential bounce in the short term.