Gold Market Analysis:

Gold prices were range-bound in early Asian trade on Thursday, October 17th, consolidating near recent highs around $2676.93 per ounce. Gold prices rallied towards record highs on Wednesday, touching $2685.15 per ounce, supported by easing US Treasury yields and expectations of further interest rate cuts by major central banks. Ongoing geopolitical tensions also provided additional safe-haven support.

The probability of a 25 basis point rate cut by the Federal Reserve in November is currently estimated at around 94.1%. The European Central Bank is widely expected to cut rates again on Thursday, while falling inflation in the UK suggests that the Bank of England may also ease monetary policy next month. However, the US dollar's strength on Wednesday, where it gained 0.3% to reach an 11-week high of 103.60, is keeping gold bulls cautious. Some profit-taking near record highs also contributed to a slight pullback in gold prices late Wednesday.

US Treasury yields declined on Wednesday, with the 10-year yield falling for the third consecutive session as investors adjusted their expectations for the interest rate path ahead of key consumer data. The 10-year yield had risen for four straight weeks, hitting a high of 4.12% on July 31st, after a strong jobs report dampened expectations of a larger 50 basis point rate cut by the Fed at its November meeting.

Investors will be closely watching the release of US retail sales data for September later today, often referred to as "terror data".  This will be followed by US initial jobless claims and industrial production figures for September. Geopolitical developments will also remain in focus.

Gold Technical Analysis:

Daily Chart:Gold prices formed a bearish candlestick with a long upper shadow on Wednesday, indicating resistance at higher levels. However, the MACD indicator is showing signs of a bullish crossover. If gold can break above and sustain gains above recent highs, further upside is likely. Support from the 5-day moving average (MA5) will be crucial.

4-Hour Chart:Despite the MACD indicator remaining in a bullish crossover and the short-term moving averages providing support, gold prices faced renewed resistance at the previous high of $2685 on Wednesday, suggesting that further upside may be limited for now. The $2685 level remains a key resistance zone to watch.

Overall:The short-term outlook for gold favors selling on rallies with selective buying on dips.

Key Resistance Levels: 2680, 2685, 2690, 2695

Key Support Levels: 2670, 2660, 2655, 2650

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