Gold prices were still seen continuing their downward momentum for the fifth day in a row on Wednesday this week, nearing a weekly low of $2,364.
This "bearish" pressure is driven by the strong US Dollar and the increase in US Treasury bond yields following the "Dovish" statement by the chairman of the BOJ (Central Bank of Japan), where Governor Shinichi Uchida has stated that the country will never raise interest rates.
As such the statement has pushed demand for the US Dollar higher, although market sentiment is currently taking into account the possibility of an aggressive interest rate cut by the Federal Reserve this year.
Market players' trajectories now put a 70% chance of a 50 basis point rate cut by the Fed in September, down from 85% just a day earlier.
At this time the demand and supply of gold prices are seen to be influenced by the broader risk trend, driven by volatility in the value of the US Dollar and expectations of Fed policy easing, following the absence of significant economic data reports this week.
In addition, market players are expected to closely monitor geopolitical developments, especially the risk of an increased conflict between Iran and Israel.
Technical Analysis Based on the daily chart, the price of gold has traded below the $2,411 level. "Sellers" in the gold market are seen as still dominating, therefore the price level of $2,378 is the focus.
If that level is successfully broken, the price of gold is expected to be able to trade lower until the price level of $2,350.
The price of gold needs to trade above the $2,400 level again to allow "Buyers" to dominate the gold market again.
