- The price of the has remained around the 1,960 dollars, while the Dollar Index tried to recover.
- Despite the drop in price pressure, Fed Chairman Mr. Waller was very optimistic.
- The gold price is gaining strength to continue rising after a strong recovery.
The price of gold (USD/XAU) is showing moderate performance around $1,960.00 in the early hours of the American session. The precious metal is struggling to offer a decisive move as investors hope that the Federal Reserve (Fed) could skip the policy tightening regime once again this month.
Recognizing a steady decline in inflationary pressures, Fed Chairman Jerome Powell skipped his tightening regime in May, but kept the door open to more rate hikes. The June inflation report conveyed that price pressures have eased more than expected as used car prices have fallen sharply.
Meanwhile, the S&P 500 is expected to open slightly bullish on a negative tone amid a risk-on environment. The Dollar Index (DXY) has recorded a short duration pullback to near 100.00, however the downside bias remains in favor as fundamentals are yet to offer support. US 10-year Treasury yields have rebounded to around 3.79%.
Despite the easing of price pressures, Fed Governor Christopher Waller issued a hawkish comment. Fed Waller is confident that two more interest rate hikes are appropriate this year to bring inflation down to 2%.
Gold technical analysis
The gold price is gaining strength to go higher after a strong recovery on a two-hour scale. An adjustment of stocks is taking place as they are traded between institutional investors and retail participants. Potential resistance lies at the June 7 high at around $1,966.70.
The rising 20-period EMA at $1,956.33 provides support for gold bulls.
The Relative Strength Index (RSI) (14) has fallen below 60.00, indicating exhaustion of bullish momentum.
Gold two hour chart
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
