The XAU/USD pair is consolidating near new local highs from February 15. Market activity remains low, and the instrument is inclined to develop a corrective decline, given that last week the quotes recorded a steady increase, which was primarily associated with the weakening of the US dollar. Pressure on the positions of the American currency is exerted by the market's expectations regarding the completion of the current US Federal Reserve cycle of raising the interest rate against the backdrop of stabilization of the inflation situation. However, the regulator is still quite "hawkish", and forecasts suggest a correction of the rate by 25 basis points at the next meeting. Most likely, a pause in the growth cycle will take place in the middle or end of summer, provided that the current trends continue in one form or another. In turn, metal quotes are also supported by the recovery of economic activity in China, which leads to a noticeable increase in demand and has a positive effect on price dynamics, as well as mixed inflation data in Europe, where, after a short decline in a number of regions, moderate growth of the indicator is recorded again. In Germany, in February, the Harmonized Consumer Price Index corrected from 9.2% to 9.3% in annual terms, while analysts expected a slowdown to 9.0%, and in monthly terms, the indicator accelerated by 1.0%, which was twice as high as in January and also exceeded market forecasts at the level of 0.7%.
Bollinger Bands in the D1 chart demonstrate flat dynamics. The price range is expanding insignificantly, barely keeping up with the surge in "bullish" sentiment at the end of last week. MACD indicator is growing preserving a stable buy signal (located above the signal line). Stochastic retains an upward direction, but is located in close proximity to its highs, which points to the risk of overbought instrument in the ultra-short term.
Resistance levels: 1869.49, 1886.46, 1900.00, 1915.00. | Support levels: 1850.27, 1828.22, 1804.41, 1786.28.