- Gold consolidating ahead of Fed Minutes
- Dollar weakness could fuel a short-term rally in the yellow metal
- It remains to be seen if the key support level at $1780 will hold
Today, Wednesday, August 17, the federal reserve will comment on their view of the economy and how they will approach fiscal policy for the remainder of the year. From a technical standpoint, it’s important not just to note key levels but even more vital to understand that these levels will mean very little if the Fed minutes surprise the market or take an unexpected decision.
Daily Chart for Gold
The Gaussian channel turned red in May 2022 and is currently pointing downward. The commodity has pulled back from its bearish trend and is trading within the Gaussian channel. Usually, the channel acts as resistance if a downtrend is present and as support if there is an uptrend. We can expect some selling pressure as prices hover around $1,761.5 and $1,838.6. If prices begin falling again, our next target is the strong support zone at $1,715.3
Short Term Outlook
On the hourly chart, the trend line has been broken to the downside; however, this does not mean an immediate bearish signal. The price is holding well above $1,780 per ounce, and as long as it remains above this level, technicals remain bullish. If a bounce out of this support level occurs, the next target could be $1,820. If the fed minutes are dovish, it will mean a stronger dollar and falling Gold prices. This would result in the support zone failing to hold, and the price may move toward the S5 pivot point at $1,757.5. The second bearish target is the $1,739.6 gap which formed on the 27th of July.