• Gold price has sensed support around a $1,702.00 cushion despite negative market sentiment.
• The DXY recovered significantly to near 110.40 ahead of October’s inflation report.
• Core CPI figure will be of utmost importance as it has not displayed signs of exhaustion yet.

Gold price (XAUUSD) is continuously picking bids around the immediate hurdle of $1,702.00 from Wednesday. The precious metal surrendered its entire Wednesday’s gains after the risk profile turned soar as investors underpinned the US dollar index (DXY) ahead of the US inflation event.

The S&P500 index was the biggest victim as investors turned anxious ahead of the outcome of the mid-term elections in addition to October’s inflation report. A majority win of Republicans will trigger political instability as approval of bills and laws will have to take a tangled route. Meanwhile, the DXY recovered sharply after registering a fresh seven-week low at 109.35.

On Thursday, the US inflation figures will remain in the spotlight. As per the preliminary estimates, the headline US CPI will decline to 8.0% vs. the prior release of 8.2%. Thanks to the falling gasoline prices that are continuously weighing pressure on plain-vanilla Consumer Price Index (CPI) figures. Also, the core CPI is seen marginally lower at 6.5%. Investors will mainly focus on core CPI figures as the catalyst has not displayed signs of meaningful exhaustion yet.

Gold technical analysis

On an hourly scale, the gold price is oscillating in a range of $1,702.10-1,722.40 after a sheer upside move. The precious metal is still holding the 50-period Exponential Moving Average (EMA) at $1,698.40, which signals that the upside is intact.

The Relative Strength Index (RSI) (14) has shifted into the 40.00-60.00 after remaining in the bullish range, which indicates that the upside momentum has exhausted but that doesn’t warrant a bearish reversal.

Gold hourly chart