That being said, tightening expectations by the Fed remain unchanged. According to the CME FedWatch tool, markets have priced in a 25 basis point (bps) hike on Wednesday but aren’t sure about the next steps after July.
In that sense, the messaging from the monetary policy statement and Jerome Powell’s stance will set the pace of the bond markets fuelling volatility on the non-yielding metals.
XAU/USD Levels to watch
If the buyers consolidate above the 100-day Simple Moving Average (SMA), the technical outlook for the XAU/USD will be bright. The Relative Strength Index (RSI) stands in positive territory, pointing north, while the Moving Average Convergence Divergence (MACD) prints green bars suggesting that the bulls are gaining strength.
Resistance levels: $1,970, $1,980, $1,990.
Support levels: $1,965 (100-day SMA), $1,940, $1,900.
