- old price holds Thursday’s late rebound this Friday, eagerly awaiting Powell’s Jackson Hole speech.
- The US Dollar returns to the red with Treasury bond yields on dovish Fed bets and the USD/JPY sell-off.
- Gold price remains poised to reclaim $2,500 on dovish Powell’s words and bullish technicals.
Gold price is back in the green zone early Friday, adding on to Thursday’s late rebound. The Gold price rebound could be linked to the resumption of the US Dollar (USD) decline, in the face of fresh USD/JPY sell-off and negative US Treasury bnnd yields.
Gold price looks Powell's speech for a fresh advance
Markets stay risk averse in Asian trading so far this Friday, as they keenly await US Federal Reserve (Fed) Chair Jerome Powell’s Jackson Hole appearance for fresh hints on the central bank’s interest-rate path, especially with traders pricing in aggressive Fed rate cuts on signs of loosening labor market conditions.
Risk-off flows boost the haven demand for the US government bonds, weighing on the Treasury bond yields across the curve and thus, dragging the USD lower. The Greenback also bears the brunt of the renewed USD/JPY sell-off, following Bank of Japan (BoJ) Governor Kazuo Ueda’s hawkish remarks before the parliament on Friday.
Ueda reaffirmed his commitment to raise interest rates if inflation stayed on course to sustainably hit the 2.0% target but remained wary about unstable financial markets.
Despite the latest upswing, Gold price looks set to book the second straight weekly loss, as a Fed interest-rate cut for September is a done deal. However, Fed Chair Jerome Powell’s comments are critical to gauging the magnitude of easing expected in the coming months.
Gold price corrected roughly 1% on Thursday after the US Dollar rebounded firmly from over one-year lows against its major rivals, as risk sentiment deteriorated on unimpressive US S&P Global business PMIs and Jobless Claims data. Further, traders resorted to repositioning in the lead-up to Powell’s Jackson Hole showdown on Friday.
Gold price technical analysis: Daily chart
The short-term technical outlook for Gold price remains in favor of buyers so long as the triangle resistance-turned-support, now at $2,470, holds.
Note that Gold price yielded a symmetrical triangle breakout last week while the 14-day Relative Strength Index (RSI) points north above 50.
These technical indicators suggest that the bullish potential remains well in place for Gold price.
On the upside, should Gold buyers recapture the record high of $2,532, the next relevant topside target is seen at the $2,550 level.
Acceptance above the latter could challenge the $2,600 round level en-route to the triangle target, measured at $2,660.
If the Gold price correction resumes, the immediate support is seen at the abovementioned triangle resistance-turned-support at $2,470.
A breach of the latter will call for a test of the. Further south, the $2,450 psychological barrier will come to the rescue of Gold optimists.
Economic Indicator
Fed's Chair Powell speech
Jerome H. Powell took office as a member of the Board of Governors of the Federal Reserve System on May 25, 2012, to fill an unexpired term. On November 2, 2017, President Donald Trump nominated Powell to serve as the next Chairman of the Federal Reserve. Powell assumed office as Chair on February 5, 2018.
Read more.Next release: Fri Aug 23, 2024 14:00
Frequency: Irregular
Consensus: -
Previous: -
Source: Federal Reserve
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended Content
Editors’ Picks
EUR/USD holds gains above 1.1100 as USD weakens ahead of Powell
EUR/USD is consolidating weekly gains above 1.1100 in European trading on Friday. The pair draws support from the renewed US Dollar selling but the upside could be capped by the dovish ECB-speak. The focus now remains on Fed Chair Powell's speech in Jackson Hole.
GBP/USD stays firm above 1.3100, Fed/ BoE speakers eyed
GBP/USD is trading with mild gains above 1.3100 in the European session on Friday. Dovish Fed expectations continue to sag the US Dollar, as traders shift their focus to the speeches by Fed Chair Powell and BoE Governor Bailey at the Jackson Hole Symposium.
Gold price remains below $2,500 as traders move to the sidelines ahead of Powell's speech
Gold price attracts some dip-buying on the last day of the week and reverses a part of Thurdsay's slide of over 1% to the weekly low. The US Dollar struggles to capitalize on the overnight bounce from the YTD low amid the prospects for lower interest rates in the US.
Decentraland price is set for a rally after breaking above the descending trendline
Decentraland (MANA) price broke above the descending trendline and trades up 1.5% as of Friday at $0.291. Additionally, on-chain data support further price gains, as MANA's Exchange Flow Balance shows a negative spike, and the long-to-short ratio stays above one.
Jerome Powell expected to lay groundwork for September rate cut in Jackson Hole speech
Market participants will closely scrutinize Powell’s speech for any fresh hints on the trajectory of monetary policy, particularly about the magnitude of the Fed’s first interest-rate cut in years.
Moneta Markets review 2024: All you need to know
VERIFIED In this review, the FXStreet team provides an independent and thorough analysis based on direct testing and real experiences with Moneta Markets – an excellent broker for novice to intermediate forex traders who want to broaden their knowledge base.