Gold price moves away from record high amid some repositioning ahead of US CPI

• Gold price meets with some supply and snaps a nine-day winning streak to a record peak.
• The downtick could be attributed to some profit-taking ahead of the crucial US CPI report.
• Bets for a June Fed rate cut to keep the USD bulls on the defensive and should lend support.

Gold price (XAU/USD) edges lower during the Asian session on Tuesday, albeit lacks follow-through and remains well within the striking distance of the record peak touched last week. Traders opt to wait on the sidelines and look to the latest US consumer inflation figures for more clues about the Federal Reserve's (Fed) rate-cut path before placing fresh directional bets around the non-yielding yellow metal. In the meantime, growing acceptance that the US central bank will cut its key interest rate at the June policy meeting leads to a further decline in the US Treasury bond yields. This keeps the US Dollar (USD) bulls on the defensive and should act as a tailwind for the commodity.

Meanwhile, a spike in the US unemployment rate bolstered the case for an imminent shift in the US central bank's policy stance. That said, Fed Chair Jerome Powell, during his semi-annual congressional testimony last week, said that still-sticky inflation could prevent an early rate cut. Hence, a hotter US CPI print could allow the US central bank to signal fewer rate cuts this year and prompt some near-term selling around the Gold price. In contrast, a softer reading could fuel speculations about an early rate cut and provide a goodish lift to the XAU/USD. Nevertheless, the crucial data is likely to infuse volatility and produce short-term opportunities around the precious metal.

Daily Digest Market Movers: Gold price bulls turn cautious ahead of US consumer inflation figures

• Some repositioning trade ahead of the crucial US consumer inflation figures exerts some pressure on the Gold price during the Asian session, though any meaningful corrective slide still seems elusive.
• The crucial US CPI report will play a key role in influencing expectations about the timing and the pace of rate cuts by the Federal Reserve, which should provide a fresh impetus to the XAU/USD.
• The headline CPI is anticipated to edge higher to 0.4% in February and the yearly rate is expected to hold steady at 3.1%, while the Core CPI is seen easing to the 3.7% YoY rate from 3.9% previous.
• The mixed US monthly jobs report released on Friday boosted rate-cut bets and dragged the yield on the benchmark 10-year US government bond to a five-week low, closer to the 4.0% mark.
• According to the CME group's FedWatch tool, traders are currently pricing in an around 70% chance of a rate cut by June, which keeps the USD bulls on the defensive and lends support to the metal.
• A sticky inflation print, however, is going to be a little troublesome to the commodity, while a cooler CPI reading will boost bets for an early rate cut and trigger a fresh leg up for the Gold price.

Technical Analysis: Gold price is likely to find decent support near $2,144, the previous record high

From a technical perspective, the Relative Strength Index (RSI) on the daily chart is flashing extremely overbought conditions and prompting some profit-taking. The near-term bias, however, still favours bullish traders in the wake of last week's break through the previous record high, around the $2,144 area. The latter should now act as a key pivotal point, which if broken decisively could drag the Gold price towards the $2,125 intermediate support en route to the $2,100 round figure.

On the flip side, bulls might now wait for a move beyond the $2,200 mark, above which the XAU/USD will enter uncharted territory and build on its recent strong gains registered over the past month or so. Meanwhile, the technical setup makes it prudent to wait for some near-term consolidation or a modest pullback before positioning for an extension of the Gold price's recent blowout rally witnessed over the past two weeks or so.