The price of gold crashed in the short term and it was trading at the 1,745 level at the time of writing. You knew from my previous analysis that the yellow metal developed a bearish pattern and that the rebound could be only temporary.
Today, the fundamentals are moving the price, that's why the volatility is high. Core PCE Price Index rose by 0.1%, less than the 0.2% expected, while Revised UoM Consumer Sentiment came in at 58.2 points far above the 55.2 points expected. Personal Income and Personal Spending came in worse than projected while the Prelim Wholesale Inventories and the Goods Trade Balance reported better-than-expected data.
Also, you knew that Fed Chair Powell's comments could really shake the markets. Jerome Powell said that the FED would continue raising rates in the next monetary policy meetings as intended.
XAU/USD Sell-off!
XAU/USD dropped below the uptrend line and through the 1,752 signaling a new sell-off. In the short term, it has increased to test and retest the downtrend line and the 1,752 - 1,754 area.
As you can see on the H1 chart, the price registered only a false breakout with great separation and now it is dropping like a rock.
XAU/USD Forecast!
1,739 represents a downside obstacle. Closing and stabilizing below this level could activate more declines and could bring new short opportunities. It could drop deeper as long as it stays below the downtrend line.
