Bullion Trending Lower As War Premium Unwinds, Fed’s Powell Speaks Later

Gold fell only 0.4% on Tuesday to $1969.40/oz despite hawkish Fed comments. Today it has continued the gradual move down falling another 0.1% to $1967.66 off the intraday high of $1971.07. Flight-to-quality flows following the October 7 Hamas attack continue to unwind while the conflict looks contained; bullion is down over a percent this week. The USD index is flat.

• The uptrend in gold remains intact and recent moves are seen as corrective. Prices have continued to trade above initial support of $1959.50, 20-day EMA, today. The bull trigger and initial resistance are at $2009.40.
• FOMC member Kashkari’s comments that it would be better to overtighten than not do enough and that inflation is yet to be contained and Bowman’s that she expects the Fed will have to hike again are likely to pressure gold. Later Fed Chairman Powell delivers some opening remarks, which given these comments are likely to be monitored closely.
• Also the Fed’s Cook, Williams, Barr and Jefferson speak. There are only US wholesale inventories on the data schedule.