XAUUSD Current price: $1,666.27

  • The market has priced in a 75 bps Federal Reserve rate hike, but surprises could be on the table.
  • US Treasury yields reached fresh multi-year highs ahead of the event.
  • XAUUSD is neutral-to-bearish in the near term and not far from the year low.

The American dollar firms up ahead of the US Federal Reserve announcement as XAUUSD trades around $1,665 a troy ounce, down from an intraday high of $1,677.80. The greenback gains by the hand of soaring government bond yields and despite the better tone of Wall Street.

US government bond yields accelerated their advances as the Fed’s announcement looms, with the 2-year Treasury note currently yielding 4.01%, a fresh multi-year high, and the 10-year note yield at 3.57%. Wall Street, in the meantime, trades in the green, with all major indexes posting gains.

The Fed is widely anticipated to hike rates by at least 75 bps. Such a movement has been already priced in, although following the latest inflation data, speculation arose of a 100 bps hike and a more hawkish message from Powell & Co. But will policymakers dare to steep up quantitative tightening? The answer to that question will set the tone for the final trading session of the day.

Gold price short-term technical outlook

The daily chart for the XAUUSD pair shows that bears retain control. The pair trimmed early gains and trades flat for the day, well below bearish moving averages. Technical indicators, in the meantime, remain within negative levels with limited directional strength.

In the near term, and according to the 4-hour chart, the pair is neutral-to-bearish. It has broken below a flat 20 SMA, while the 100 and 200 SMAs head firmly south, far above the current level. The Momentum has turned lower but remains stuck to its midline, while the RSI accelerated its decline and currently stands around 40. The pair bottomed at $1,654.11 this year, the level to break to confirm a steeper decline.

Support levels: 1,654.10 1,643.90 1,641.75

Resistance levels: 1,680.30 1,692.35 1,707.10

View Live Chart for XAUUSD  

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Feed news Join Telegram

Recommended Content


Recommended Content

Editors’ Picks

EUR/USD stays below 0.9800 after US inflation data

EUR/USD stays below 0.9800 after US inflation data

EUR/USD continues to trade in negative territory below 0.9800 in the American session on Friday. The data from the US showed that the annual PCE inflation declined to 6.2% in August but the stronger-than-expected core reading didn't allow the pair to gain traction.

EUR/USD News

GBP/USD rebounds from daily lows, reclaims 1.1100

GBP/USD rebounds from daily lows, reclaims 1.1100

GBP/USD fell to a fresh daily low below 1.1030 but managed to reverse its direction and climbed above 1.1100 during the American trading hours on Friday. The pair remains on track to snap a two-week losing streak despite having suffered heavy losses earlier in the week.

GBP/USD News

Gold extends daily rally beyond $1,670

Gold extends daily rally beyond $1,670

Gold preserved its bullish momentum and rose above $1,670 after the mixed inflation data from the US on Friday. The benchmark 10-year yield is down more than 2% as markets look to wrap up the third quarter, fueling XAU/USD's daily rally. 

Gold News

Shiba Eternity download day the biggest bullish catalyst in SHIB history?

Shiba Eternity download day the biggest bullish catalyst in SHIB history?

Shytoshi Kusama, the project lead for Shiba Inu, has dropped a teaser about Shiba Eternity games for the SHIB community. Proponents expect the launch of the collectible card game to be a bullish catalyst for Shiba Inu price. 

Read more

SPDR S&P 500 ETF Trust (SPY) Forecast: We are teetering on the brink

SPDR S&P 500 ETF Trust (SPY) Forecast: We are teetering on the brink

Equity markets remain at the precipice of a technical collapse, which we examine in the weekly long-term chart below. The overall picture remains one of nervousness ahead of the upcoming Q3 earnings season.

Read more

Majors

Cryptocurrencies

Signatures