Gold Price Forecast: Further recovery in XAU/USD appears elusive but Powell holds the key

Gold price rebounds from fresh six-week lows but upside appears limited. Fed Chair Jerome Powell’s speech in focus, FXStreet’s Dhwani Mehta reports.

See – Gold Price Forecast: XAU/USD to drop on Fed's tapering and prospects of rate hikes – ANZ

The bearish bias remains well in place

“Looming uncertainty around the fate of debt-ridden China Evergrande keeps investors unnerved, boding well for the dollar at gold’s expense.”

“The yields on the US bonds remain at elevated levels, which could likely undermine gold’s rebound from multi-week lows.”

“Evergrande speculations will continue to impact the risk trends while Fed Chair Jerome Powell’s speech will be eagerly awaited for fresh trading impetus in gold price.”

“If the channel support at $1736 is breached on a daily closing basis, then a drop towards the $1700 psychological level could be in the offing.”

“Should the recovery find additional legs, the 21-SMA at $1767 could be tested. Further up, the 50-SMA at $1771 will be next in play. The falling trendline (channel) resistance at $1785 could guard the further upside.”