Gold Price Forecast: Sellers to remain in control of XAU/USD's action

Gold spiked above $1,780 on Friday but lost its bullish momentum. XAU/USD is set to stay on the back foot as the technical outlook remains bearish, FXStreet’s Eren Sengezer reports.

See – Gold Price Forecast: XAU/USD to extend its declining trend due to three reasons – ABN Amro

Focus shifts to US September CPI inflation data

“On Wednesday, the US Bureau of Labor Statistics will release the Consumer Price Index (CPI) data for September. Investors forecast the annual CPI to tick up to 5.4% from 5.3% in August. Even if the core inflation in the US turns out to be softer than expected in September, this report by itself is unlikely to change the market’s view on the Fed’s tapering plan.”

“On Thursday, the US Department of Labor’s weekly Initial Jobless Claims data will be looked upon for fresh impetus ahead of Friday’s Retail Sales report, which is anticipated to show a modest contraction in September.”

“On the downside, the initial support is located at $1,750 (lower limit of the weekly channel) ahead of $1,730 (static level) and $1,720 (late September low).”

“The first hurdle aligns at $1,763 (20-day SMA) ahead of $1,780 (October 8 high, 50- day SMA). Only a daily close above the latter could open the door for a prolonged rebound toward $1,800, where the 100-day SMA, 200-day SMA and the Fibonacci 50% retracement of the April-June rally meet.”