Gold Price Analysis: XAU/USD erases losses ahead of Powell and Biden, tests $1850
|- Gold prices rebound from three-day lows, limited by $1850.
- DXY turns negative ahead of Powell and Biden.
After the beginning of the American session, gold gained momentum and broke above $1943, hitting a fresh daily high at $1852. So far, it has been unable to remain above $1850. Price is moving sideways ahead of key speeches.
The yellow metal is gaining moment as market participants await Fed’s Powell speech. The recent increase in US bond yields and speculations about what the central bank will do over the next meetings make Powell’s words more interesting.
President-elect Joe Biden is expected to present its stimulus package. Investors anticipate a big relief package. Wall Street opened with modest gains and remained in the positive ground even after weaker-than-expected employment economic data.
The US dollar pulled back over the last hour in anticipation of the next events. The DXY is flat as of writing, hovering around 90.35, after hitting at 90.58, the highest level in two days.
XAU/USD is facing a strong resistance around $1850 and the 100-hours SMA. A consolidation above could open the door for a test of the weekly high around $1863. On the flip side, below $1843, the next support is $1835.
Technical levels
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