Gold price extends Tuesday’s late rebound into early Wednesday, looks to $3,350.
US Dollar rebound loses steam despite shaky Middle East ceasefire, hawkish Fed’s Powell.
Gold price defends the critical 50-day SMA support while the daily RSI struggles near the middle.
Gold price is building on its previous rebound early Wednesday, snapping a three-day bearish streak as the USD rebound fizzles ahead of day 2 of Fed Chair Jerome Powell’s congressional testimony and mid-tier US data.
Gold price is benefiting from a slight negative shift in risk sentiment in Asian trading on Wednesday as traders remain wary about the shaky Iran-Isreal ceasefire.
A renewed US Dollar selling, fuelled by a downtick in the USD/JPY pair following the hawkish commentary from Bank of Japan (BoJ) board member Naoki Tamura and hot Japanese Services PPI, also supports the Gold price upswing.
Meanwhile, markets digest the hawkish remarks from Fed Chair Powell delivered during his testimony on the semi-annual Monetary Policy Report before the House Financial Committee on Tuesday.
Powell said he expects policymakers to stay on hold until they have a better handle on the impact tariffs will have on prices, per CNBC News.The Greenback briefly drew support from Powell’s comments but the Middle East ceasefire optimism boosted risk appetite and drove US stocks higher, diminishing the USD’s appeal as a safe-haven.
Amid hawkish Fed Chair Powell’s comments and the shaky Middle East truce, Gold price tumbled to two-week lows at $3,295 before reversing sharply to settle Tuesday well above the $3,300 level.
The focus now shifts toward the mid-tier US housing data release and Powell’s testimony before the Senate later in the day. Markets will continue to pay close attention to any fresh developments on the Iran-Israel geopolitical front.
Daily technical analysis
The daily chart shows that Gold price has managed to defend the strong support of the 50-day SMA, now at $3,325.However, the 14-day RSI struggles to regain the midline so far, currently trading near 49.
Therefore, it remains to be seen if the bright metal can retain its hold above the 50-day SMA yet again.A failure to resist above the 50-day SMA on a daily closing basis will retest the 38.2% Fibo level of the April record rally at $3,297.
A sustained break of the latter could trigger a fresh downtrend toward the $3,250 psychological barrier, below which the 50% Fibo level at $3,232 will come into play.
On the other hand, recapturing the 21-day SMA at $3,352 is critical for a sustained recovery from two-week troughs.
The next upside hurdle is aligned at the 23.6% Fibo level at $3,377.
Gold buyers will then target the $3,400 threshold once the 23.6% Fibo resistance is decisively taken out.
GOLD defends 50-day SMA, but for how long?
Gold price is building on its previous rebound early Wednesday, snapping a three-day bearish streak as the USD rebound fizzles ahead of day 2 of Fed Chair Jerome Powell’s congressional testimony and mid-tier US data.
Gold price is benefiting from a slight negative shift in risk sentiment in Asian trading on Wednesday as traders remain wary about the shaky Iran-Isreal ceasefire.
A renewed US Dollar selling, fuelled by a downtick in the USD/JPY pair following the hawkish commentary from Bank of Japan (BoJ) board member Naoki Tamura and hot Japanese Services PPI, also supports the Gold price upswing.
Meanwhile, markets digest the hawkish remarks from Fed Chair Powell delivered during his testimony on the semi-annual Monetary Policy Report before the House Financial Committee on Tuesday.
Powell said he expects policymakers to stay on hold until they have a better handle on the impact tariffs will have on prices, per CNBC News.The Greenback briefly drew support from Powell’s comments but the Middle East ceasefire optimism boosted risk appetite and drove US stocks higher, diminishing the USD’s appeal as a safe-haven.
Amid hawkish Fed Chair Powell’s comments and the shaky Middle East truce, Gold price tumbled to two-week lows at $3,295 before reversing sharply to settle Tuesday well above the $3,300 level.
The focus now shifts toward the mid-tier US housing data release and Powell’s testimony before the Senate later in the day. Markets will continue to pay close attention to any fresh developments on the Iran-Israel geopolitical front.
Daily technical analysis
The daily chart shows that Gold price has managed to defend the strong support of the 50-day SMA, now at $3,325.However, the 14-day RSI struggles to regain the midline so far, currently trading near 49.
Therefore, it remains to be seen if the bright metal can retain its hold above the 50-day SMA yet again.A failure to resist above the 50-day SMA on a daily closing basis will retest the 38.2% Fibo level of the April record rally at $3,297.
A sustained break of the latter could trigger a fresh downtrend toward the $3,250 psychological barrier, below which the 50% Fibo level at $3,232 will come into play.
On the other hand, recapturing the 21-day SMA at $3,352 is critical for a sustained recovery from two-week troughs.
The next upside hurdle is aligned at the 23.6% Fibo level at $3,377.
Gold buyers will then target the $3,400 threshold once the 23.6% Fibo resistance is decisively taken out.
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