The latest US May Personal Consumption Expenditures (PCE) price index, both month-on-month and year-on-year, was largely in line with expectations. The data did not alleviate investor concerns about the Federal Reserve’s need to raise interest rates. However, it’s worth noting that while both overall durable goods orders and orders excluding defense durable goods contracted in May, the final estimate of US first-quarter GDP was revised upwards, and May’s personal consumption and personal income growth exceeded expectations and the previous reading. These non-inflationary economic data, while not overwhelmingly supporting a significant Fed rate hike, also did not amplify investor expectations of a rate cut. Therefore, gold prices may continue to test lower support levels in the short term before opportunities arise for buying on dips, providing momentum for a rebound.

A long position can be established around $3,968, with a short-term target of $4,079 for profit-taking and a stop-loss at $3,948.

Gold price chart (1 hour):

Ferris Kwok

Chief Analyst
Success Finance Group

Email: ferris.kwok@successfn.com