Gold remains bid above key technical levels ahead of Powell testimony

Gold trades above 50-day MA and ascending trendline.
Powell to stick to approach of gradually lifting rates.

Omkar Godbole FXStreet Contributor

Gold (XAU/USD) retreated from the overnight high of $1,341 to $1,335, tracking the recovery in the dollar index (DXY) from 89.43 to 89.70.

However, it is still trading above the 50-day moving average (MA) of $1,332. Further, the ascending trendline (drawn from the Dec. 12 low and Feb. 8 low) support is intact. The short-term bullish setup indicates the investors expect the new Fed chair Powell to stick to the approach of gradually lifting rates, despite indications that inflation is perking up.

That said, the trendline support could be breached if Powell sees a reason to raise rates more than three times this year. It is worth noting that the XAU/USD risk reversals have turned negative, suggesting a rise in demand for XAU puts (sell gold or bearish bets on gold). So, investors could be seeking downside protection against the long spot positions.

Powell will make his first major appearance as head of the Federal Reserve before the House Finance Committee on Tuesday at 10 a.m. ET., according to CNBC report.

Gold Technical Levels

A break below $1,332 (50-day MA) would expose the previous day's low of $1,327, under which a major support is seen at $1,320.97 (Feb. 22 low). On the other hand, a move above $1,341.07 (previous day's high) would open up upside towards $1,344.75 (Jan. 15 high) and $1,351.40 (Feb. 19 high).

	TREND INDEX	OB/OS INDEX	VOLATILY INDEX
15M	Bearish	Neutral	High
1H	Bullish	Neutral	Low
4H	Bearish	Neutral	Expanding
1D	Bearish	Neutral	Low
1W	Bearish	Neutral	High
Updated Feb 27, 02:45 GMT

Author

Omkar Godbole

FXStreet Contributor

Omkar Godbole, editor and analyst, joined FXStreet after four years as a research analyst at several Indian brokerage companies.

EUR/USD climbs to daily highs near 1.1820

EUR/USD now picks up pace and advances to the area of daily peaks north of the 1.1800 barrier at the end of the week. The pair’s decent move higher comes against the backdrop of a generalised lack of direction in the FX galaxy and the mild offered stance in the US Dollar.

GBP/USD trims losses, retests 1.3460

After briefly challenging its key 200-day SMA near 1.3440, GBP/USD now manages to regain some balance and revisit the 1.3460 zone on Friday. Cable’s pullback comes as the selling pressure on the Greenback gathers traction, reigniting some recovery in the risk-linked space.

Gold flirts with four-week highs past $5,200

Gold extends its rebound, climbing for a third consecutive session and pushing back above the $5,200 mark per troy ounce on Friday. The move higher continues to draw support from lingering geopolitical tensions and the ongoing uncertainty surrounding US trade policy, both of which are keeping safe-haven demand firmly in play.

Bitcoin, Ethereum and Ripple consolidate with short-term cautious bullish bias

Bitcoin, Ethereum and Ripple are consolidating near key technical areas on Friday, showing mild signs of stabilization after recent volatility. BTC holds above $67,000 despite mild losses so far this week, while ETH hovers around $2,000 after a rejection near its upper consolidation boundary.

Breaking: US and Israel attack Iran, risk aversion to sweep global markets

Early Saturday, United States (US) President Donald Trump announced that the US had begun “major combat operations” in Iran, following Israel’s pre-emptive missile attacks against Tehran.

Starknet unveils strkBTC, shielded Bitcoin transactions on Ethereum Layer 2

Starknet, the Ethereum Layer 2 network developed by StarkWare, today announced strkBTC, a wrapped Bitcoin asset that introduces optional shielding while preserving full DeFi composability.