Today is an important day as investors prepare themselves for the beginning of a new earnings quarter. Wall Street giants will be reporting their earnings, and investors will dissect their reports very closely. JP Morgan, Goldman Sachs, and Wells Fargo are some of the names who will report their earnings, and so far, the price trend indicates that bulls have been ruling the price action. Traders are expecting solid earnings from these banks, and the area of focus will be loan growth.
Another major event that will gather a lot of attention among traders will be the first US listing of a crypto exchange. Since yesterday, we have seen tremendous interest in cryptocurrencies, and crypto traders have pushed the Bitcoin price towards another record high. Listing of Coinbase in the US is a big deal for many investors because it somehow sends a signal that the US lawmakers aren’t going to ban bitcoin, and the crypto king is here to stay.
As for the economic calendar, all eyes will be on the Federal Reserve Chair Jerome Powell, who will be discussing the economic recovery. His remarks on the US economy and soaring inflation will be critical, especially following the US inflation data that came out yesterday.
Yesterday, we saw the US consumer prices rise 0.6% during March, and core prices also soared 0.3%. Both of these numbers came ahead of the forecast, but there was some relief among investors following these numbers. The reason was that speculators had been hoping for a much stronger number. Remember, since the Federal Reserve embarked on the asset purchase programme, traders have been speculating on soaring inflation and the Fed being left behind the curve.
The gold price is still maintaining its upward momentum to a large extent, and it is holding on to its yesterday’s gain. Traders are supporting the gold price, as they believe that concerns about the Fed’s monetary policy were overblown.
The Fed has assured investors and traders that they aren’t going to change the sailing path of their monetary policy, and further clarification of this is going to come when Jerome Powell speaks later today.
In terms of gold’s technical price level, it is important to keep an eye on the 50-day SMA on the daily time frame. If bulls continue to keep the price above this average, we will have a strong chance for the gold price to continue moving higher. However, if the price falls below this moving average, and remains below it, then we could see the gold price retesting the $1,700 price level.