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  • Powell’s prepared remarks revive hopes for aggressive policy easing by the Fed.
  • A sharp intraday turnaround in the US bond yields provided a strong boost.
  • The USD weakens across the board and remained supportive of the up-move.

Gold caught some aggressive bids and surged to weekly tops, around the $1411-12 region during the early North-American session.

The latest leg of a sudden pick up in the last hour or so came after the Fed Chair Jerome Powell – in the prepared statement to the Congress, reiterated that the central bank will act as appropriate to sustain the US economic growth.

The remarks revived hopes for aggressive policy easing by the Fed, which was evident from a sharp intraday turnaround in the US Treasury bond yields and provided a strong boost to the non-yielding yellow metal.

Adding to this, the US Dollar weakened across the board in reaction to Powell’s dovish sounding comments and further collaborated towards driving flows, benefitting the dollar-denominated commodity.  

It would now be interesting to see if bulls are able to capitalize or the up-move fizzles out at higher levels as the focus now shifts to Powell’s question and answer session ahead of the release of June FOMC meeting minutes.

Technical levels to watch