Fundamental view:

Gold traded low against the greenback during the course of the week. Fed speakers throughout the week have referred to the start of the bond tapering assets. St. Louis Fed James Bullard and New York’s Fed John Williams both agreed that the reduction of the QE will begin later in this year whereas Atlanta’s Fed Raphael Bostic commented that it will be appropriate to reduce the bond purchasing program sometime this year and added that he sees the economy in a reasonably strong position.

All the Fed officials’ speech helped the pair this week. On Friday Mester said that she sees upside risks to the inflation forecasts and that she would be comfortable winding down the stimulus in the first half of 2022.              

The major economic events deciding the movement of the pair in the next week are Federal Budget Balance at Sep 13, EIA Crude Oil Stocks Change at Sep 15, Retail Sales monthly report, Initial Jobless Claims at Sep 16 and Michigan Consumer Sentiment at Sep 17 for US.

XAU/USD Weekly outlook:

Technical View:

Last week’s high was 0.20% lower than the previous week. Maintaining high at 1830.2 and low at 1782.4 showed a movement of 478 pips.

In the upcoming week we expect XAU/USD to show a bullish trend.  The Instrument is trading below the 200 Simple Moving Average and the MACD trades to the upside. A solid breakout above 1817.8 may open a clean path towards 1847.9 and may take a way up to 1865.7. Should 1770.0 prove to be unreliable support, the XAUUSD may sink downwards 1752.2 and 1722.1 respectively. In H4 chart cup and handle pattern formation favors prospects of a bullish trend. Also to be noted Bullish engulfing formation exerts the expectation of uptrend for the pair.