Fundamental analysis of XAU/USD

Gold prices (XAU) are currently near a one-month low and are trading at 1916.50, with this week proving to be one of the worst in two months. Interestingly, the fall in gold prices comes despite the release of cooler-than-expected US inflation data. According to the latest data, the US consumer price index rose 3.2% year-on-year, slightly below the forecast of 3.3%. This has sparked talk that the US Federal Reserve will refrain from raising interest rates further this year. 
 
It is important to note that rising interest rates can reduce the attractiveness of gold as they often lead to higher bond yields, making assets such as gold less attractive. The core consumer price index rose 4.7%, although slower than expected. Such figures do not make traders too happy, as evidenced by the indifferent reaction of the gold market. Comments from Fed member Mary Daley only added to the uncertainty, suggesting that decisions on further rate action are still being made. 
 
In such a situation, gold prices fell about 1.4% for the week. The US dollar index and 10-year Treasury yields look set to rise for the fourth consecutive week. At the same time, interest rate concerns and geopolitical issues around China are also weighing on gold prices. Notably, the US dollar has failed to maintain its bullish momentum after Thursday's rally, with volatile US Treasury yields keeping the market on the sidelines. Recent US inflation data has reassured federal policymakers, with Reserve Bank of Australia Governor Philip Lowe pointing to concerns over rising unemployment as justification for a pause in monetary policy adjustments. 
 
In addition, speculation over the currency stance of banks such as the Reserve Bank of New Zealand and the European Central Bank has taken center stage as the global economy has evolved. The two banks are not expected to make drastic changes at upcoming policy meetings. Continued support for the RMB from Chinese policymakers is generating some optimism in the market, signaling China's potential to overcome its economic challenges. 
 
More broadly, upcoming events such as the U.S. PPI and Michigan Consumer Confidence Index are under the watchful eye of gold enthusiasts, especially as the U.S. Federal Reserve's Open Market Committee prepares for next week's monetary policy meeting. Given all these factors, the near-term outlook for gold looks somewhat bearish.
  
Technical analysis and scenarios:

The Alligator indicator indicates that the market is currently in a downtrend. This is evidenced by the wide open jaw of the Alligator, with the jaw (blue line) well above the lips and teeth (green and red lines). The Awesome Oscillator (AO) and Accelerator Oscillator (AC) readings are in the red zone, further reinforcing the bearish momentum in the market.
Main scenario (SELL)
Recommended entry level : 1910.00.
Take Profit: 1900.00.
Stop Loss: 1915.00.
Alternative scenario (BUY)
Recommended entry level: 1923.00.
Take profit: 1930.00.
Stop loss: 1917.00.