Fundamental view:

Gold markets have rallied significantly during the course of the week but have given back all the gains on Friday. The downside pressure was exerted by a stronger dollar after U.S. data showing inflation stayed hot last month and the market has put the focus back on the Federal Reserve’s policy meeting next week. The consumer spending data fueled worries about aggressive monetary policy action from the Fed to combat a surge in prices, sending yields the U.S. 10-year higher.

This week, sour sentiment challenged the commodity’s upside momentum. The same took clues from an absence of a deal on US President Joe Biden’s $1.75 trillion stimulus package. Recently, US House Speaker Nancy Pelosi conveyed her optimism towards the passage of infrastructure and social spending, climate bills during the phone call to postpone the vote on the infrastructure bill. The continuous rise in inflationary pressures comes along with signs of a global economic slowdown and fueled worries about the risk of stagflation. This, in turn, tempered investors appetite for perceived riskier assets. Upcoming FOMC meeting will the next driver of the bullion market.           

The major economic events deciding the movement of the pair in the next week are ISM Manufacturing PMI at Nov 01, ADP Nonfarm Employment Change, ISM Non-Manufacturing PMI, EIA Crude Oil Stocks Change, Fed Interest Rate Decision at Nov 03, Nonfarm Productivity quarterly report at Nov 04 and Nonfarm Payrolls at Nov 05 for US.

XAU/USD Weekly outlook:

Technical View:

Last week’s high was 0.18% lower than the previous week. Maintaining high at 1810.4 and low at 1771.8 showed a movement of 386 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 downside. A solid breakout above 1804.9 may open a clean path towards 1827.0 and may take a way up to 1843.5. Should 1766.3 prove to be unreliable support, the XAUUSD may sink downwards 1749.8 and 1727.7 respectively. In H4 chart bullish bat pattern favors prospects of a bullish trend. Also to be noted Bullish harami formation exerts the expectation of uptrend for the pair.