Gold Price Forecast: XAU/USD dives below $1,800 after Powell’s speech


  • Gold drops $30 on Powell's comments to $1,780.
  • Powell confirms Fed tapering plans and sents gold plunging.
  • XAU/USD’s dives to test support at $1.770/80.

Gold futures have reversed course on Friday’s US trading session. The yellow metal has lost about $30 in a matter of minutes, retreating from six-week highs at $1,813 to $1,780 on the back of Fed Powell’s speech.

Powell’s confirms QE tapering and gold plunges

Bullion has lost most of the ground gained earlier today, weighed by the US dollar’s bullish reaction to Federal Reserve chairman Powell’s words. Powell has reaffirmed the bank’s plan to start reducing its bond’s purchases and has played down the possibility of an interest rate hike in the coming months. The market reaction has favoured the dollar’s recovery, weighing on stock markets and commodities.  

Gold prices had appreciated about 1% previously, favoured by increasing concerns about the persistently high inflation. Buoyed by its status as a traditional hedge against inflation pressures and a broad-based US dollar correction, the yellow metal was on track to post its best weekly performance in the last months.

XAU/USD’s reversal tests support at $1.770/80

Gold’s reversal has been contained at $1.770/80 previous resistance area. Below here bears might gain traction and send the pair towards $1,745 (October 6 low) before facing a key support area at $1,725 (September 29, 30 low).

On the upside, immediate resistance will be now at $1,807/10 (Sept. 15 high/Intra-day high) ahead of September’s peak. At $1.830 and 1,865 (Jun. 15 high).

Technical levels to watch

XAU/USD

Overview
Today last price 1788.75
Today Daily Change 5.77
Today Daily Change % 0.32
Today daily open 1782.98
 
Trends
Daily SMA20 1762.7
Daily SMA50 1779.61
Daily SMA100 1793.06
Daily SMA200 1793.95
 
Levels
Previous Daily High 1789.48
Previous Daily Low 1776.58
Previous Weekly High 1800.62
Previous Weekly Low 1750.24
Previous Monthly High 1834.02
Previous Monthly Low 1721.71
Daily Fibonacci 38.2% 1784.55
Daily Fibonacci 61.8% 1781.51
Daily Pivot Point S1 1776.55
Daily Pivot Point S2 1770.11
Daily Pivot Point S3 1763.65
Daily Pivot Point R1 1789.45
Daily Pivot Point R2 1795.91
Daily Pivot Point R3 1802.35

 

 

 

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