Gold Touches $1,842 mark in early U.S. Session, Traders eye U.S. Fed Chair Powell’s Testimony; June 22, 2022

U.S. Fed Chair Powell’s Testimony

Today the key event for the day will be U.S. Fed Chair Powell’s Testimony scheduled at 1330 GMT/1900 IST. As head of the central bank, which controls short term interest rates, he has more influence over the nation’s currency value than any other person. Traders scrutinize his public engagements as they are often used to drop subtle clues regarding future monetary policy.

The testimony usually comes in 2 parts: first he reads a prepared statement (a text version is made available on the Fed’s website at the start), then the committee will hold a question and answer session. Since the questions are not known beforehand they can make for some unscripted moments that lead to heavy market volatility.

Lawmakers are likely to levy questions about the pandemic response, rising inflation and the overall strength of the U.S. economy. The U.S. dollar may rise if Powell firms up already strong expectations for further tightening. Let’s see how markets react on Fed’s Testimony.

Let’s see how Gold was reacted during the previous data release:

March 02:

Technical View:

XAU/USD (Gold):

• Gold strengthens sharply ahead of Fed Chair Powell’s Testimony and touches $1,842 mark.
• The pair made intraday high at $1,842 and Low at $1,823 mark.
• A day chart and H1 chart with triple EMA suggest down trend for the time being.
• A sustained close above $1,844 on H1 chart requires for the upside rally.
• Alternatively, a consistent close below $1,822 on H1 chart will test further supports.

Take a look and do trade wisely!
Good Luck