GOLD Analysis – US CPI Temps, Gold Spotted Breaks $1,950!

<p>&nbsp;Gold investors were all smiles at yesterday's New York session trading as the price of the yellow metal soared to a 1-month high.</p><p><br /></p><p>This is none other than the lack of United States (US) inflation data published yesterday.</p><p><br /></p><p>The reading was somewhat surprising with inflation in June falling to 3.0%, lower than the forecast of 3.1%, from the previous month's level of 4.0%.</p><p><br /></p><p>This is seen as adding support to the Federal Reserve (Fed) policymakers' statement that the cycle of monetary policy tightening is nearing its end.</p><p><br /></p><p>The US dollar suffered a significant decline from the market's reaction to the data, while seeing the price of gold soar.</p><p><br /></p><p>Looking at the price movement on the XAU/USD chart which measures the value of gold against the US dollar, the price initially dropped briefly in the European session to around 1934.00.</p><p><br /></p><p>However, after the CPI data was published, prices surged past the important target level of 1950.00.</p><p><br /></p><p>Momentum managed to be maintained until the end of the session, and the price managed to finish trading around the 1958.00 high.</p><p><br /></p><p><br /></p><p>The movement of gold prices was slow in the Asian session today (Wednesday), but showed a slight improvement at the beginning of the European session.</p><p><br /></p><p>It is likely that the price will continue to move higher into the next session with the target of heading to the next concentration zone at 1980.00.</p><p><br /></p><p>However, the risk towards the end of the week cannot be denied and the price of gold may fall again at the end of the week.</p><p><br /></p><p>If the price pulls back below 1950.00, investors should watch out for further declines.</p><p><br /></p><p>The 1930.00 zone will be the next target on the continued decline and clearer indications for a trend change will be observed.</p>