Fundamental view:

The yellow metal showed an uptrend against the greenback. Greenback was weak due to the steep decline witnessed in the US Treasury bond yields. In the past week, Core Consumer Price Index (CPI), edged higher to 1.6% in March from 1.3%. Although this reading surpassed the market expectation of 1.5%. FOMC Chairman Jerome Powell reiterated that it was really unlikely for the Fed to start raising rates before the end of 2022. “Low inflation, deflation reduce the ability of the central bank to fight downturns,” Powell added. “We want to overshoot inflation moderately after we’ve been below 2%.” 10-year US T-bond yield slumped to its lowest level in more than a month. All these catalysts contributed to the weakness of the greenback.              

The major economic events deciding the movement of the pair in the next week are EIA Crude Oil Stocks Change at April 21, Initial Jobless Claims, EIA Natural Gas Storage Change at April 22, Markit Manufacturing PMI and New Home Sales at April 23 for US.

XAU/USD Weekly outlook:

Technical View:

Last week’s high was 1.41% higher than the previous week. Maintaining high at 1783.8 and low at 1723.7 showed a movement of 601 pips.

In the upcoming week we expect XAU/USD to show a bullish trend.  The Instrument is trading above the 200 Simple Moving Average and the MACD trades to the upside. A solid breakout above 1799.0 may open a clean path towards 1821.4 and may take a way up to 1859.1. Should 1738.9 prove to be unreliable support, the XAUUSD may sink downwards 1701.2 and 1678.8 respectively. In H4 chart semi – w pattern breakout favors prospects of a bullish trend. Also to be noted Bullish harami formation exerts the expectation of uptrend for the pair.