Gold – a bounce off the lows, but tomorrow's inflation data decides

Gold is trading around $4,340 today. Yesterday, it slipped to roughly $4,270 before buyers stepped back in and pushed it higher. The recent slide has paused, at least for now.

Two factors are driving the bounce. Fresh fighting in the Middle East, including shelling on the Israel-Lebanon border, revived some safe-haven demand. And some traders who had bet on gold falling took profits ahead of tomorrow's big event.

That event is the US inflation report, known as CPI, out on Wednesday. It matters because last week's strong jobs data pushed the market to price a 70% chance of a Fed rate hike by December, up from 45% a week ago. Gold pays no interest, so higher rates work against it. A hot inflation number tomorrow would add to the pressure. A soft one could give gold more room to recover.

So today's bounce is real, but fragile. The inflation report sets the direction from here.

Gold key levels:

• Resistance: $4,400, then $4,500
• Support: $4,270, then $4,200

Watching: Wednesday's US inflation report (CPI), the Fed meeting on 16–17 June, and Middle East headlines.

Risk Disclaimer: All research and/or forecasts above reflect the author's personal opinion and cannot be treated as trading advice. Born2trade is not responsible for any trading results based on any information in this article. Trading Forex and CFDs carries a high level of risk to your capital. You may lose all of your invested funds. Forex and CFD trading may not be suitable for all investors. Please ensure that you fully understand the risks involved and, if necessary, seek independent advice.

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