The international gold price may drop again to $1911

Investors were generally waiting for the release of the Federal Reserve's latest monetary policy meeting minutes and other economic data to be released, and the market was more cautious. Poor US economic data on Monday provided support for gold prices, and international trade tensions also provided confidence to bulls.

On Wednesday (July 5), spot gold fluctuated in a narrow range near its near-one-week high in the Asian session. It is currently trading around $1,924.30/ounce. Investors are generally waiting for the Federal Reserve to release the latest monetary policy meeting minutes and other economic data. The market is more cautious. The poor US economic data on Monday provided support for gold prices, and the tense international trade situation also provided confidence to bulls.

The Federal Reserve held interest rates steady at 5% -5.25% in June and said it may need at least two more 25 basis point rate hikes before the end of the year.

"Weaker-than-expected US economic data (including PMI) on Monday provided support for gold," said Giovanni Staunovo, an analyst at UBS. "Market participants will be closely tracking upcoming US labour market data to see if previous US rate hikes slow the economy."

But the minutes of Wednesday's June meeting are likely to be "hawkish, consistent with Powell's recent testimony," Mr. Staunovo added.

The world's major central banks raised interest rates in June by the most in a single month this year, many of which beat market expectations. At the same time, it predicted more interest rate hikes in the future, and the top central bankers tried to gain the upper hand in the battle against inflation. This still weighs on gold prices in the medium and long term.

According to the CME's Fedwatch tool, investors see a near 86% chance of a 25 basis point rate hike in July. High interest rates discourage investment in non-yielding gold.

From a technical perspective, gold prices still have some room to rebound, but it is still necessary to guard against the possibility of returning to a downward trend after the rebound is blocked.

This trading day will release the monthly rate of US factory orders in May and the final monthly rate of US durable goods orders in May, and investors also need to pay attention; in addition to the Federal Reserve meeting notes, the Federal Reserve's "No. 3 person" and New York Fed President Williams participated in the discussion of the Central Bank Research Association (CEBRA) 2023 annual meeting, investors also need to pay attention.

Daily level: rebound after the shock falls; after the key support level records the "Hope Star" bottom signal, the gold price continues to rebound, the KDJ golden fork runs, the MACD preliminary gold price runs, and there are further opportunities for rebound in the short term. The preliminary resistance is near the 21-day moving average of 1934.25, and the strong resistance is near the 100-day moving average of 1946.09. If the resistance can be broken, the bullish signal for the market outlook will be increased. Further resistance refers to the position near the high of 1956.66 on June 20 and the position near the 55-day moving average of 1967.26.

Before breaking through the 21-day moving average of 1934.24, it is still necessary to guard against the possibility of gold prices returning to a downward trend. The initial support is near the 5-day moving average of 1919.68, the low support on Monday is near 1909.93, and then the 1900 integer mark. If it falls below this level, it will increase the bearish signal of the market outlook.

Resistance: 1934.25; 1940.00; 1946.09; 1956.66;

Support: 1919.68; 1909.93; 1900.00; 1885.66;

Short-term operation suggestions: cautious long on dips; cautious short on highs.