- After approaching $1,730, XAU/USD abruptly changed direction.
- ECB decision pushed up bond yields and weakened equity markets.
- Focus on Lagarde and Powell.
The Prayed It changed direction after the European Central Bank’s decision and fell from a one-week high of $1,728 to $1,712, marking a new daily low. In this way, the positive tone that the yellow metal had was left behind and the downward pressures re-emerge.
The ECB raised benchmark interest rates by 75 basis points and said it will raise them again. The central bank’s tone pushed up bond yields in the US and Europe, leaving gold in trouble.
In minutes, the press conference of Christine Lagarde, the president of the ECB, will begin. In another event, the chairman of the Federal Reserve, Jerome Powell, will speak. In the US, a mixed report of requests for unemployment benefits was known.
As far as gold levels go, a return below $1710 would expose $1700. Below the next level of consideration is the weekly low at $1688 and then the long-term support at the $1675 area. To the upside, a return above $1720 could restore some of the recently lost shine to gold.
Technical levels
Source: Fx Street
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