Gold Price Analysis: XAU/USD needs to crack $1722 for additional downside, Powell eyed

Gold remains pressured as Turkish upheaval keeps the DXY underpinned.
Falling Treasury yields slow the decline in XAU/USD ahead of Powell.
XAU bears tease rising wedge breakdown on the 4H chart.

Dhwani Mehta FXStreet

Gold (XAU/USD) has stalled its rebound and turns south once again, undermined by broad-based US dollar strength, as markets seek safety in the greenback amid fears of overheating and Turkey’s abrupt sacking of the central bank Chief.

Although the XAU buyers remain hopeful amid falling US Treasury yields, which make the non-yielding gold relatively attractive. The benchmark US 10-year rates shed 3.30% so far, back under the 1.70% level.

Gold’s fate hinges on the Fed Chair Jerome Powell’s speech due later in the session ahead. However, the bright metal risks further falls if the risk-aversion deepens in European trading and refuels the haven demand for the buck.

From a near-term technical perspective, gold is on the verge of confirming a rising wedge breakdown if the price closes the four-hour candlestick below the $1737 support.

Gold Price Chart: Four-hour

The bears will then test the bullish 50-simple moving average (SMA) at $1730, below which the 100-SMA at $1722 could be challenged.

Acceptance below the latter is needed to extend the downside towards the previous month low of $1717.

The Relative Strength Index (RSI) points south while trading currently at 48.99, suggesting that the spot is poised for more losses.

On the flip side, if the 100-SMA support holds, a move back towards the pattern support now resistance at $1737 would not be ruled.

Further up, the daily high of $1747 could be next on the buyers’ radar, as they eye a sustained break above the $1750 psychological level.

Gold: Additional levels

XAU/USD

Overview
Today last price	1732.32
Today Daily Change	-13.18
Today Daily Change %	-0.76
Today daily open	1745.5

Trends
Daily SMA20	1736.99
Daily SMA50	1793.99
Daily SMA100	1831.46
Daily SMA200	1860.55

Levels
Previous Daily High	1746.86
Previous Daily Low	1728.56
Previous Weekly High	1755.59
Previous Weekly Low	1719.3
Previous Monthly High	1871.9
Previous Monthly Low	1717.24
Daily Fibonacci 38.2%	1739.87
Daily Fibonacci 61.8%	1735.55
Daily Pivot Point S1	1733.75
Daily Pivot Point S2	1722.01
Daily Pivot Point S3	1715.45
Daily Pivot Point R1	1752.05
Daily Pivot Point R2	1758.61
Daily Pivot Point R3	1770.35

Author

Dhwani Mehta

FXStreet

Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.

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