On Wednesday (July 17), spot gold hit a record high of $2,482.29 per ounce earlier in the session, then came to a profit settlement. The New York market closed down about 0.6% and closed at $2,454.98 an ounce. Market optimism that the Fed will cut interest rates in September continues to heat up, and the weakening dollar boosted demand for gold. As a result, gold continued to set a record high in the Wednesday market after Tuesday.

Market expectations that the Fed will get closer to cutting interest rates continue to heat up. This expectation is driving US bond yields to continue to slowly fall. Coupled with the weakening of the US dollar, this is the main driving force behind the gold trend. According to the Beige Book released by the Federal Reserve on Wednesday, economic activity expanded slightly to slightly from the end of May to the beginning of July, and companies reported that the labor market showed some signs of continued weakening. The contents of the Beige Book have increased market confidence that the Federal Reserve is closer to cutting interest rates. Earlier, more Federal Reserve policy makers said that after prices rose faster than expected earlier this year, they are increasingly convinced that the pace of price increases is already falling back towards the Federal Reserve's target. It even indicates that the time has come to cut interest rates. The attitude of the Federal Reserve's monetary policy makers has clearly begun to gradually shift towards dovish. This significant change in fundamentals has given investors more reasons to reallocate their gold holdings, and has also led to a fervent pursuit of price-sensitive funds. The upward trend in gold appears to be taking great strides.

Source: Yi Huitong

On a technical level, judging from the daily chart, the price of gold is much higher than all of its moving averages, which form a sharp upward slope. Meanwhile, technical indicators have accelerated upward and are close to the overbought region, but there are no signs of exhaustion. In the short term, according to the 4-hour chart, gold is overbought, but there is limited room for a corrective decline. The 20-period simple moving average (SMA) led the gold price to continue to move upward, and the moving average provided dynamic support around $2,420 per ounce. The 100-period SMA and 200-period SMA are also higher below the shorter moving averages, which is in line with increased buying interest. Finally, the momentum indicator maintained its bullish slope at extreme levels; however, the Relative Strength Index (RSI) remained flat and is currently around 76, indicating that the price of gold may face a risk of profit adjustment in the short term. Overall, however, I'm afraid the trend of gold continuing to improve without change. The current lower support levels are $2448.90 per ounce; $2435.10 per ounce; and $2422.65 per ounce, respectively. The upper resistance levels are at $2493.00 per ounce and $2500.00 per ounce, in that order.

Bank of China Guangdong Branch Wang Gang

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