Talking Points:

• After falling below the support level of 1,830.00 USD, XAU/USD prices have continued their losses.
• Given the out-of-control inflation rate, Fed Powell’s speech is anticipated to be very pessimistic.
• Russian XAU/USD trading is expected to be prohibited by the EU.

After breaching the crucial support level of 1,830.00 USD, XAU/USD has increased its losses in the Asian trading session. Earlier, the precious metal was steadily dropping as investors remained cautious ahead of Federal Reserve (Fed) chair Jerome Powell’s speech. A solid plunge below 1,830.00 USD has given gold bears a burst of adrenaline, potentially dragging XAU/USD prices considerably lower.

Bulls are hoping that Fed Chair Powell would order a very hawkish stance for monetary policy in July. The Fed has already increased interest rates in the last four months to 1.50-1.75 %, but the effect on the inflation issue is still not clear. The US dollar index (DXY), which is seeking to hold above Tuesday’s high of 104.60, has benefited from this.

According to views sources, the European Union (EU) Leaders Summit could restrict gold imports or exports, or both, from Russia after limiting oil imports. If that happens, the price of gold might become much more erratic

Various central banks’ monetary policy plans are suggesting hawkish direction for future policies, which will keep XAU/USD bulls on the edge of their seats.

Gold Technical Analysis

The Descending Triangle, whose horizontal support is set at 1,834.39 USD and whose downward-sloping trendline is drawn from Thursday’s high of 1,857.04 USD, has been broken downward on the hourly chart for XAU/USD. The downward filters are strengthened by the descending 50-day simple moving average (SMA) around 1,835.74 USD. The Relative Strength Index (RSI), meanwhile, has moved into a bearish area of 20.00-40.00, indicating further declines are to come.

XAU/USD Hourly Chart: