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Gold is struggling to move past key resistance despite Powell’s dovish tone

  • The American dollar – gold’s biggest nemesis – is no the defensive, courtesy of Powell’s dovish comments.
  • Still, gold is struggling to beat the resistance if the trendline connecting the Oct. 26 and Nov. 7 highs.

Gold is currently trading at $1,222, having clocked a high of $1,227 in the overnight trade.

Fed Chair Powell, at 17:00 GMT yesterday, said the interest rates are “just below” the level where they won’t stimulate the economy (neutral level), squashing bets of an extended policy tightening period.

As a result, the US dollar exchange rate, as represented by the dollar index, fell almost 100 pips to 96.69. The losses in the greenback put a bid under the zero-yielding yellow metal.

So far, however, the metal has not been able to beat the falling trendline resistance, currently at $1,222. A daily close above that level would signal a continuation of the rally from the Nov. 13 low of $1,196.

The prospects of a bullish break above the trendline hurdle look strong, as the dollar index created a bearish outside-day candle yesterday, implying a bullish-to-bearish trend change.

Gold Technical Levels

XAU/USD

Overview:
       Today Last Price:  1222.73
       Today Daily change:  2.4e+2  pips
       Today Daily change %:  0.196%
       Today Daily Open:  1220.34
Trends:
       Previous Daily SMA20:  1217.55
       Previous Daily SMA50:  1219.33
       Previous Daily SMA100:  1207.94
       Previous Daily SMA200:  1235.46
Levels:
       Previous Daily High:  1231.8
       Previous Daily Low:  1211.2
       Previous Weekly High:  1230.3
       Previous Weekly Low:  1217.7
       Previous Monthly High:  1243.43
       Previous Monthly Low:  1182.54
       Previous Daily Fibonacci 38.2%:  1223.93
       Previous Daily Fibonacci 61.8%:  1219.07
       Previous Daily Pivot Point S1:  1210.42
       Previous Daily Pivot Point S2:  1200.51
       Previous Daily Pivot Point S3:  1189.82
       Previous Daily Pivot Point R1:  1231.02
       Previous Daily Pivot Point R2:  1241.71
       Previous Daily Pivot Point R3:  1251.62

 

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