Gold Standstill Ahead of Powell Speech – Buckle Up for Breakout!
Arslan Butt • 1 min read
During the Asian session, gold prices traded slightly but continue to consolidate near the key $1,500 level ahead of U.S. Fed chair’s speech for clues on future rate cuts and the U.S.- China trade war concerns, which are still keeping the market riskly.
The U.S. Federal Reserve Powell is due to deliver the highly-awaited speech later today during the New York session to kick start meeting of central bankers in Jackson Hole. Uncertainties about additional easing rose after two Fed officials stated they detected no reason to cut interest rates again without having fresh evidence of an economic slowdown.
Besides, the demand for dollar is also getting hit due to weakness in Chinese Yuan. On Thursday, China’s yuan plunged to fresh 11-year lows amid concerns about the intensifying Sino-U.S. trade war. Weaker Chinese Yuan makes dollar-denominated gold expensive for China, thus demand to start diminishing.
On the technical front, gold analysis hasn’t changed much from few days. As forecasted, it has already dropped to 1,494. Gold’s immediate support now prevails 1,489 the violation of these levels can expose gold towards 1,470 area. On the other hand, gold is likely to face resistance around 1,500 and 1,507. The RSI and Stochastics are holding in the selling zone, demonstrating that the bearish Bias is still strong.
Gold – XAU/USD – Technical Levels
Key Trading Level: 1498.3
GOLD – XAU/USD – Trade Plan
Since the 1,494 is giving a hard time to gold, pushing it up for the third time this week, we have opened a buy position above 1496.195 to target 1499.195.