Jakarta, GIC Trade – Gold prices were little changed around $1920 an ounce on Monday, as investors weighed the prospect of further monetary tightening against concerns about a global economic slowdown. 
 
The disappointing performance of consumer and producer prices in China added to signs of a shaky recovery and rising deflationary risks. In the US, mixed payrolls reports showed a slowdown in job creation, but pointed to strong wage growth and a decline in the unemployment rate. 
 
Meanwhile, the upcoming U.S. CPI report, scheduled for Wednesday, is expected to provide additional updates on inflationary pressures. Market participants set a nearly 92% probability of the Federal Reserve raising the funds rate by 25 basis points this month, despite doubts about the need for further rate hikes after July. 
 
In addition, other major central banks, including the European Central Bank, the Bank of England, and the Bank of Canada, are expected to continue their tightening pace.
 
A weaker risk tone provided support to gold prices, although rebounding USD demand capped gains. Traders also appeared reluctant to place aggressive bets ahead of the US CPI report on Wednesday.
 
Nonetheless, a good increase in demand for the US Dollar (USD) is seen acting as a headwind for Gold prices. Although slightly missed the headlines of US Nonfarm Payrolls (NFP), the unexpected decline in the unemployment rate and firm wage growth indicate that labor market conditions are still tight.
 
Fundamentally, further hikes in the benchmark interest rate from a number of central banks put pressure on gold prices, however, pessimism among market participants and risk-off sentiment provided support for gold. Then how technically, see the following analysis:
 
Technical Analysis

 
Gold prices in the 1-hour period tried to move down, touching the support level at 1919.70 until heading to the next support level at 1904.80. While the bearish bias is also supported by a sell signal indicated by a red arrow.
 
This analysis is a fundamental and technical view used by the author, not a suggestion or invitation. To get more information click on the image below.