Gold Faces Downward Pressure as Hawkish Fed Commentary Persists

Gold Faces Downward Pressure as Hawkish Fed Commentary Persists

On Friday, XAU/USD prices are trending lower, approaching $1,930, following the hawkish remarks from Federal Reserve (Fed) Chairman Jerome Powell on the previous day. Powell suggested that the Fed's monetary policy may not be adequately restrictive to control inflation.

This week, several Fed policymakers echoed Powell's sentiments, indicating that interest rates might not be high enough to effectively restrain inflation towards the Fed's 2% target in the future. This unexpectedly hawkish stance has disrupted the prevailing market narrative, challenging the assumption that the Fed had concluded its rate-hiking cycle and was poised for a rate-cutting phase.

Having secured profits on Friday, our focus today is on a bearish continuation. We anticipate the price to potentially reach levels around 1927.00 or even further down to 1920.50
The sustained downward pressure reflects the impact of the Fed's unexpected shift in policy expectations, prompting a reevaluation of the gold market.


Our preference

Short positions below 1950.00 with targets at 1927.00 & 1920.50 in extension.