GOLD consolidates under 21-period SMA ahead of US PCE reading

Gold holds steady below a 21-period SMA as investors prepare for the release of key US macroeconomic data later today.
 

Expected Macroeconomic Data:

• PCE Price Index: 0.3% - Expected; 0.3% - Previous
   
• Personal Income: 0.3% - Expected; 0.5% - Previous
   
• Personal Spending: 0.3% - Expected; 0.8% - Previous
   
• Chicago PMI: 41 - Expected; 37.9 - Previous
   

The focus remains on the PCE reading (the Fed's preferred way of measuring inflation), which could potentially influence the Fed's interest rate decision at the next meeting.
 

Higher for longer interest rates could contribute to the rise of the US dollar, pushing the price of the zero-yielding metal lower.

At the time of writing, markets are pricing in a 55.3% probability of a rate cut in September 2024.

Despite the risk of higher interest rates remaining in place for longer than the markets originally anticipated, XAUUSD may be supported by "safe-haven" demand as well as ongoing geopolitical instability.

Over the past 3 days (May 28-30), the total net asset value of the world's largest gold ETF remained almost intact at $62.8 billion (-0.09% change from May 28).

From the technical prospective …

Gold is consolidating in between the 21- and 50-period SMA. Breaking below or above these major resistance and support levels could have a major effect on the gold further trajectory.

The relative strength index (RSI) is in the neutral zone, underscoring the markets uncertain positioning as investors await for the US key macro-economic data to be released today.

$2400 psychological level may be the key target level for the XAUUSD bulls. While to the downside the 50-period SMA (~$2326.850) may provide an immediate support if the XAUUSD bears try to regain the initiative.