TODAY XAUUSD SIGNAL : Gold Price Forecast XAUUSD extends losses below $1,670 as DXY strengthens, Fed policy buzz
- Gold prices are declining to recapture their two-year low at $1,654.20 amid soaring hawkish Fed bets.
- The Fed is expected to deliver a surprise announcement regarding the interest rates.
- Price pressures have not responded effectively to the current pace of hiking interest rates.
TODAY XAUUSD SIGNAL : Gold price XAU/USD has witnessed a vertical fall after failing to overstep the critical resistance of $1,680.00 in the Asian session. The precious metal is eyeing more losses as an intraday inventory distribution is indicating the resumption of a downside journey ahead. The yellow metal is expected to find a cushion around a two-year low at $1,654.20.
The gold prices are facing severe pressure from the market participants as the US dollar index (DXY) is gearing up for a fresh rally ahead. As per the consensus, the Federal Reserve (Fed) will announce a third consecutive rate hike by 75 basis points (bps). However, investors should be prepared for an upside surprise as the price pressures have not responded effectively to the current pace of hiking interest rates.
TODAY XAUUSD SIGNAL : A survey from Financial Times dictates that the interest rates will peak around 4-5% and will remain steady beyond 2023. It further cited that the inflation chaos will take sufficient time to get fixed and a series of slowdowns in the inflationary pressures will only warrant adaptation of a ‘neutral’ approach.
Gold technical analysis
On an hourly scale, gold prices are declining towards potential support at $1,654.20, which is a two-year low, recorded last week. Declining 20-and 50-period Exponential Moving Averages (EMAs) at $1,670.50 and $1,674.74 adds to the downside filters. Also, the Relative Strength Index (RSI) (14) is on the verge of slipping into the bearish range of 20.00-40.00, which will trigger a bearish momentum.
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