• Gold price is gauging support around $1,830.00 ahead of Fed Powell.
• Fed Powell may dictate the ideology behind announcing the 75 bps rate hike in June.
• The momentum oscillator RSI (14) is advocating a consolidative move ahead.

Gold prices (XAU/USD) are testing the waters after a strong rebound below $1,830 in the late New York session. The precious metal has displayed a firmer responsive buying action but needs more filters to confirm a bullish reversal. Broadly, a gradual downside move could be named to the recent move in the asset as investors are keeping an eye on Federal Reserve (Fed) chair Jerome Powell’s testimony.

The Fed has already elevated its interest rates by 75 basis points (bps) to 1.50-1.75% officially this month. It would be worth noting the guidance on upcoming monetary policies. Apart from that, Fed Powell in May monetary policy conference dictated that a 75 bps rate hike is not into consideration. In spite of that, Fed Powell went beyond his statement and featured a bumper rate hike. It is important to understand the ideology behind selecting the 75 bps rate hike.

Meanwhile, the US dollar index (DXY) has turned sideways ahead of Fed Powell’s testimony. On Tuesday, the DXY rebounded firmly after hitting the round-level support of 104.00. The 10-year US Treasury yields remained flat on Tuesday at around 3.30%.

Gold technical analysis

The trendline placed from June 16 high at $1,857.40, adjoining Friday’s high at $1,853.04 will act as a major resistance for the gold prices going forward. The precious metal is auctioning below the 21-period Exponential Moving Average (EMA) at $1,835.24, which signals a short-term weakness in the counter.  Meanwhile, the Relative Strength Index (RSI) (14) has shifted into a 40.00-60.00 range, which signals a consolidation ahead.

Gold hourly chart