• Gold bears are licking their lips while price is technically curled and biased lower.[riceistechnicallycoiledandbiasedlower[riceistechnicallycoiledandbiasedlower
  • A break of the resistance opens up the risk of higher highs.

Gold fell from a high of $1,967 in the US session on Friday and cleared the length of the previous session to set a new low for the day at $1,953.32.

The focus was on the Federal Reserve, which issued a hawkish outlook on interest rates on Wednesday, although it ended its two-day meeting without raising rates. Fed forecast 50 basis points of additional increase before the end of the year.

”It is probable Fed will need to see a softening in the labor market to be sure that inflation is on a sustainable downward path. Little guidance was offered for the upcoming meetings, with Fed Chairman Powell noting that decisions will be made on a meeting-by-meeting basis. We continue to expect a 25 basis point increase in July,” analysts at ANZ Bank argued.

Meanwhile, the dollar rallied early after three losing sessions. Bond yields were also higher, with the U.S. two-year note last paying 4.733%, up 8.2 basis points, and the 10-year note rising 4.9 basis points to 3.772%. DXY is trading 0.13% higher from a low of 102.006 to a high of 102.427.

As the trend signals improve, CTA trend followers have already started to increase their length silver, where current prices could trigger a purchase program totaling +6% of this cohort’s maximum size. In the gold markets, the bar for buying algae is also thin. Prices only need to break the $1980/oz barrier to trigger the first marginal buying program, and the risk of subsequent buying flows is elevated above the $2000/oz range,” analysts at TD Securities argued.

Technical analysis of gold

The 15-minute chart shows a series of levels to the downside for a breakout, while the daily offers a bearish bias while it is below the trendline resistance and breaks the channel:

With that being said, there will be prospects for a move higher if the bulls remain committed and break the trendline resistance.

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