Fundamental view:

Gold dropped against the greenback during the trading course of the week. The yellow metal started this week under significant bearish pressure with the optimisms of truce between Russia and Ukraine, However the market sentiment became sour on Thursday which helped the gold. Russia and Ukraine both rejected reports claiming that they were moving closer to a peace agreement. Later in the day, Reuters reported that there still was a very big gap between the positions of Ukraine and Russia. Moreover, the week closed with increased fears of a possible nuclear attack and concerns about the effect of the war on global growth and inflation.

US Federal Reserve monetary policy decision also acted as a major catalyst in driving the market which helped the US dollar. The Fed has increased fund rate by 25 basis points to 0.50% for the first time since 2018 and meet the market expectation, the bank has hinted at seven rate hikes in 2022, that is, one at each remaining monetary policy meeting, and affirmed the commitment to start reducing its $9 Trillion balance sheet after their next meeting. 

The major economic events deciding the movement of the pair in the next week are Fed Chair Powell Speech at Mar 21, EIA Crude Oil Stocks Change at Mar 23, Core Durable Goods Orders monthly report, Initial Jobless Claims at Mar 24, Michigan Consumer Sentiment and Fed Governor Waller Speech at Mar 25 for US.

XAU/USD Weekly outlook:

Technical View:

Last week’s high was 4.03% lower than the previous week. Maintaining high at 1990.0 and low at 1894.6 showed a movement of 954 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 1976.1 may open a clean path towards 2030.7 and may take a way up to 2071.5. Should 1880.7 prove to be unreliable support, the XAUUSD may sink downwards 1840.0 and 1785.4 respectively. In H4 chart falling wedge pattern breakout favors prospects of a bullish trend. Also to be doji formation exerts the expectation of uptrend for the pair.