- The dollar falls despite the strong message from the Fed.
- DXY falls more than 1% at the close of the week.
- Gold raises its head and rises towards $1730.
The Prayed is rising on Friday and reached as high as $1729.50, reaching the highest level since August 30. The price remains near the maximum, with a bullish tone although limited by $1730.
The advance of the yellow metal occurs in a context of dollar weakness and before a rise in the equity markets. A decline in government bond yields, both US and European, also helps.
The above occurs, despite the 75 basis point rise in the interest rate by the European Central Bank on Thursday and also after Jerome Powell, the president of the Fed, will send a harsh message against inflation, encouraging expectations of a rise of 75 basis points at the next meeting.
Next week the US inflation figure for August will be released, which will be key to expectations about monetary policy. The next Fed meeting is on September 20-21, 2022.
Looking at $1730
The $1730 zone is the immediate resistance for XAUUSD and above it then follows $1742. The bullish tone is expected to hold as long as the price remains above $1720. Beneath it is $1707, which if broken could trigger an acceleration to the downside to test the 2-week low around $1690.
Technical levels
Source: Fx Street
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