Gold Price Forecast: XAU/USD falls back to $1,870 as US CPI inflation reignites Fed rate fears

• Spot Gold price down into $1,870 as markets reverse course following US CPI inflation print.
• Markets continue to underprice US inflation, kicking off risk-off flows.
• XAU/USD has turned red for Thursday, down from the day's opening prices near $1,875.

XAU/USD fell off the day's highs into $1,870 after the US Consumer Price Index (CPI) inflation reading showed that US inflation continues to stick higher than investors are hoping for, sending markets piling into safe havens.

US CPI inflation holds steady at 3.7% in September vs. 3.6% forecast

Spot Gold set an intraday high of $1,885, a ten-day high for XAU/USD bids before tumbling back into Wednesday's trading range.

Rising inflation fears in broader markets are seeing an uptick in investor fears that the Federal Reserve (Fed) might be pushed into an additional rate hike before the end of 2023, and could see the Fed's "dot plot" shift further out on when the anticipated rate cut cycle could begin.

XAU/USD Technical Outlook

Intraday price action sees XAU/USD prices sliding into the 50-hour Simple Moving Average (SMA) as Gold bids tumble back to the near-term median, with the 200-hour SMA turning bullish into $1,842. 

Gold prices remain overall well-bid in the medium term after catching a firm ride up the order sheets as Gold prices struggle to lift themselves from 2023's lows.

Daily candlesticks see spot Gold getting knocked off a recent swing high, with bids up over 3% from the last swing low of $1,810. The 50-day SMA is settling into $1,900 after a bearish cross of the 200-day SMA, which is floating just shy of $1,930.

XAU/USD Hourly Chart

XAU/USD Daily Chart

XAU/USD Technical Levels