Gold Price Forecast: XAU/USD remains pressured towards $1,915 – key support

Update: Despite the pullback in the US dollar alongside the Treasury yields, gold price is heading south towards the critical demand area around $1,915. Gold bears remains in control, as the dust settles over the hawkish FOMC minutes, which revealed that the Fed officials outlined plans for the balance sheet reduction and rate hikes in the upcoming meetings. The persistent risk-off trading, in the wake of worries over aggressive Fed’s tightening and Ukraine crisis, is keeping the downside in gold price checked. Later in the day, the weekly US Jobless Claims and speeches from several Fed officials will be closely followed for the fresh direction on gold price. Further, the sentiment in the bond market will also play a pivotal role for the bright metal.

Also read: Don’t get too bullish on the DXY

Gold (XAU/USD) has been witnessing a lackluster performance over the last six trading sessions. The precious metal is displaying back and forth moves in a range of $1,915.22-1,949.86. It is worth noting that the release of the Federal Open Market Committee (FOMC) minutes and speeches from various Federal Reserve (Fed) policymakers this week have failed to put any substantial impact on gold prices.

The minutes that have received much attention from the FOMC in March is the expectation of one more interest rate hike by 50 basis points (bps) this year. Apart from that, the rapid pace at which the Fed will augment the balance sheet reduction is one of the major highlights. Fed policymakers are majorly agreed on monthly caps of about $60B for Treasury securities, and $35B for mortgage-backed securities (MBs). 

Meanwhile, Philadelphia Fed President and FOMC member Patrick Harker in his speech on Wednesday has indicated that restoration in the interest rates is likely that will bring the lending rate back to neutral at 2.5%.

The mighty US dollar index (DXY) is aiming to tap the psychological resistance of 100.00 amid fresh sanctions on Russia by the US administration, which has triggered the negative market sentiment. The US has imposed full blocking sanctions on Russia's Sberbank and Alfa Bank, which will dramatically escalate the financial shock on Moscow as these giants of the latter holds more than one-third assets of Russia

Gold Technical Analysis

On an hourly scale, XAU/USD is juggling in a range of $1,915.22-1,949.86 over the past few trading sessions. The precious metal has established below 200-period Exponential Moving Average (EMA) at $1,930.00, which adds to the downside filters. Meanwhile, the Relative Strength Index (RSI) is oscillating in a 40.00-60.00 range, which advocates a consolidation ahead.

Gold hourly chart