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Published: 18 May 2026,06:01
Daily Market Analysis New
*U.S.–China meeting remained constructive but delivered limited market impact
*Strong U.S. economic and inflation data continue supporting the dollar
*Gold falls for a fourth consecutive session as USD strengthens
The US dollar index, which tracks the greenback against a basket of six major currencies, extended its gains and headed for its strongest weekly performance in more than two months. A series of stronger-than-expected U.S. economic reports released recently has continued to reinforce optimism surrounding the resilience of the U.S. economy.
Back-to-back inflation reports, combined with firm retail sales data, have strengthened expectations that the Federal Reserve may need to maintain a tighter monetary policy stance moving forward. Money markets are now increasingly pricing in the possibility of another Fed rate hike this year, a notable shift from previous expectations that leaned toward easier monetary policy.
At the same time, Kevin Warsh has recently adopted a more neutral stance regarding future interest rate policy, rather than openly supporting aggressive rate cuts. Investors are increasingly expecting the incoming Fed leadership to remain data-dependent, focusing primarily on inflation and economic conditions before making policy adjustments.
Rising crude oil prices have also contributed to the dollar’s strength by increasing inflation concerns and pushing U.S. Treasury yields higher, further supporting demand for the greenback.
Gold prices, on the other hand, extended their losses for a fourth consecutive session as the stronger dollar and rising yields continued to pressure the precious metal. Solid U.S. economic data, firm inflation readings, and hawkish Federal Reserve expectations have increased the opportunity cost of holding non-yielding assets such as gold.
Overall, the combination of resilient U.S. economic performance, elevated oil prices, and tightening monetary policy expectations continues to support the US dollar, while gold remains under pressure from rising yields and a stronger macroeconomic backdrop.
Technical Analysis
GOLD, H4
Gold prices are trading lower, currently testing the key psychological support level at 4,500.00, which serves as an important near-term floor.
A confirmed breakdown below 4,500.00 could extend losses toward the next support at 4,425.00, signaling continuation of the broader corrective move.
Momentum indicators remain weak, with the MACD showing fading bullish momentum and the RSI at 28 remaining in oversold territory, suggesting bearish pressure is still dominant despite increasingly stretched conditions.
However, if selling pressure begins to ease, gold may stage a technical rebound toward the 4,565.00 resistance level, followed by 4,630.00 if recovery strengthens.
Resistance Levels: 4565.00, 4630.00
Support Levels: 4500.00, 4425.00
DOLLAR_INDX, H4:
The dollar index is trading higher after a breakout above the 99.20 resistance level, reinforcing the short-term bullish structure.
If bullish momentum persists, the index could extend gains toward the next Fibonacci resistance at 99.55, with further upside toward the psychological 100.00 level.
However, momentum indicators are beginning to show signs of exhaustion. The MACD is losing bullish strength, while the RSI at 76 remains in overbought territory, suggesting an increased risk of a near-term technical correction.
If momentum fades, the index may retest the 99.20 support level, with further downside toward 98.90 if selling pressure builds.
Resistance Levels: 99.55, 100.00
Support Levels: 99.20, 98.90
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