Spot gold remains directionless after U.S. Fed Powell ‘committed’ to fighting inflation

June 23, 2022 - 2 weeks ago
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The precious yellow metal was directionless Thursday after the head of the U.S. Federal Reserve said policymakers are doing all they can to bring inflation under control after reaching 8.6%.

U.S. Federal Reserve Chair Jerome Powell made the remarks on Wednesday to members of the Senate Banking Committee as part of a two-day semiannual monetary policy report to Congress.

Last week, the U.S. Federal Reserve raised the benchmark borrowing rate by 0.75 percentage points, its biggest interest rate hike in the U.S. since 1994 amid rising inflation.

U.S. Fed Powell is due to testify again in Washington DC on Thursday (Friday, 12 am Sydney time).

Meanwhile, the US dollar index (US DXY), which tracks the greenback against a basket of its peers, was flat at 103.98.

Based on the technical assessment, the Relative Strength Index (RSI) indicator, 3-daily ‘lookback’ remains a negative bias, while the Moving Average Convergence Divergence (MACD) supports a weak positive bias. The ADX indicator holds to a ranging market.

Although the $1,830 level was recently penetrated, we still need a New York close beneath this level to support the bearish case to reach the region of $1,801-04 – Reassess from there.

Viewing the topside, the resistance is located at $1,838, with $1,850-52 assessed above.

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