Gold Price Forecast: XAU/USD Soars to $1,982 Following Fed’s Powell’s Dovish Comments

• The XAU/USD pair is trading at $1,971.15, up 1.24%.
• Fed Chairman Jerome Powell’s comments at the Economic Club of New York raised expectations that the Fed would not raise rates again.
• Powell says the policy is restrictive and stresses the need to set it cautiously.

The price of Gold (XAU/USD) extended its gains to three consecutive days and approached the next cycle high at $1,982.15 a troy ounce after comments from US Federal Reserve Chairman Jerome Powell weighed on the dollar, as the Investors do not expect further rate increases from the Fed. XAU/USD is trading at $1,971.15, with a gain of 1.24%.

The price of Gold (XAU/USD) extends gains for three consecutive days, approaching the high of $1,982.15 per troy ounce

During Powell’s appearance at the Economic Club of New York, Wall Street oscillated, but at the time of writing, it is trading at a loss. Fed Chairman Jerome Powell commented that policy is restrictive and that the Fed will proceed “carefully” in setting its policy. He stressed that above-trend growth and a tight labor market “could justify further tightening of monetary policy.”

As a result, US Treasury bond yields, particularly the benchmark 10-year note rate, hovered around a ten basis point spread, although it had settled around 4.973%, but failed to shore up to the Dollar, which registers losses of 0.47%, as shown by the US Dollar Index (DXY), at 106.05.

In terms of data, in the US the Philadelphia Manufacturing Index for September was published, reflecting a gloomy economic outlook for the region. At the same time, the US Bureau of Labor Statistics (BLS) revealed that initial jobless claims last week fell to 198,000, below forecasts and previous figures of 212,000 and 211,000. , respectively.

Next week some Fed members will give statements before entering their blackout period, as they prepare for the next monetary policy meeting.

XAU/USD Price Analysis: Technical Outlook

After breaking above the 200-day moving average (DMA) at $1,930.70, gold could test the latest cycle high at $1,987.42, before recovering to $2,000. Once these two zones are overcome, the next objective would be the all-time high at $2,081.82. On the other hand, if the sellers were to move and drag the prices below the psychological zone of $1,950, it would open the door to test key support levels such as the 200-DMA at $1,930.68, the 100-DMA at 1,922 $.13 and the 50 DMA at $1,902.54.