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Mar 06
2024

Gold price falls slightly from near record highs ahead of Fed Powell’s testimony

Gold price edges down in Wednesday’s European session after failing to recapture the all-time high of around $2,145.00. The precious metal is expected to stay on the sidelines as investors await Fed Chair Jerome Powell’s testimony.

Technical Overview

Gold price falls gradually after failing to test the all-time high near $2,145. The yellow metal trades inside Tuesday’s trading range. The near-term appeal for Gold remains bullish as it has delivered a breakout of the Symmetrical Triangle pattern formed on a daily time frame. The breakout of the aforementioned Chart pattern exhibits a volatility expansion, which leads to wider ticks on the upside and heavy volume.

The 14-period Relative Strength Index (RSI) holds above 60.00, indicating a bullish momentum ahead. The RSI (14) is not showing any divergence signals but has reached overbought territory.

 

Fundamental Overview

Gold price (XAU/USD) edges down in Wednesday’s European session after failing to recapture the all-time high of around $2,145.00. The precious metal is expected to stay on the sidelines as investors await Federal Reserve (Fed) Chair Jerome Powell’s testimony before Congress, starting at around 15:00 GMT.

Investors expect that Jerome Powell will support keeping interest rates in the range of 5.25%-5.50% until he gets evidence that inflation will return to the desired rate of 2%. Non-yielding assets, such as Gold, face outflows when the Fed favors a hawkish interest rate stance for an extended period.

Market participants will also focus on the United State ADP Employment Change and JOLTS Job Openings data for February and January, respectively, which will provide more insights into labor demand.

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