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The Fed chairman, Powell, speaking will set a 450-600 pips gold trading range

Gold dropped from 1909 to 1786 after the news that the Fed would aggressively to raise US Interest Rate  by 0.5 to 0.75 to counter high inflation.

The drop from 1909 to 1786 was a result of rising US Yield and US interest rate policy. Gold then made a temporary bottom around 1786-1790 when the Fed confirmed that 0.5 interest rate would be raised in June and July.

Gold went from 1786 to 1865 because the 0.5 hike did not meet market expectation and the flow of fund into US Dollar had peaked.

 

 

XAUUSD Gold Chart H1

XAUUSD Gold Chart H1

US inflation is going up and the market is expecting the Fed will raise US interest rate by 0.75 or higher in June and July. Mr. Powell will speak about monetary policy at 17:00 GMT may give a hint about June and July  US interest rate hikes.

Using gold day chart, gold will go to 1895-1900 or 1909-1915 if the Fed keeps the 0.5 rate hike in June and July.

Gold will resume its down trend to 1810-1815 or it will drop heavily if gold breaks the 1786-1790 zone if the Fed decides to raise rate by 0.75 or higher.

XAUUSD Gold Day Chart

XAUUSD Gold Day Chart

 

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