Fundamental view:

The yellow metal was trading tight range at the beginning of the week due to the thin trading conditions because of Easter on the week beginning which allowed financial markets to remain calm. After that, the sharp drop witnessed in the US Treasury bond yields weighed heavily on the greenback and triggered a rebound in the pair. Decline noted in the benchmark 10-year US T-bond yield also provided a boost to the precious metal.

During last week, FOMC Chairman Jerome Powell acknowledged that the traditional tool to deal with inflation would be to raise rates but said that a one-time increase in prices does not necessarily point to persistent inflation.  Powell downplaying inflation concerns, greenback saw the pressure favoring the XAU/USD pair.              

The major economic events deciding the movement of the pair in the next week are CPI monthly report at April 13, EIA Crude Oil Stocks Change, Fed Chair Powell Speech at April 14, Retail Sales monthly report, Initial Jobless Claims at April 15 and Building Permits at April 16 for US.

XAU/USD Weekly outlook:

Technical View:

Last week’s high was 1.47% higher than the previous week. Maintaining high at 1758.7 and low at 1721.3 showed a movement of 374 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 1761.2 may open a clean path towards 1778.7 and may take a way up to 1798.6. Should 1723.8 prove to be unreliable support, the XAUUSD may sink downwards 1703.9 and 1686.4 respectively. In H4 chart Ascending Triangle breakout favors prospects of a bullish trend. Also to be noted Bullish hammer formation exerts the expectation of uptrend for the pair.