Gold rises over 1% on dovish Powell’s remarks in Jackson Hole

Gold price jumped to one-week high on Friday, in immediate reaction to the speech of Fed Chair Jerome Powell at the Jackson Hole symposium.

Markets saw Powell’s remarks as dovish as he pointed to growing risk to the job market (particularly after very disappointing July labor report, as well as strong downward revisions in hiring numbers in previous two months) and elevated inflationary risk that requires a balanced reaction from the central bank.

However, Powell noted that rise in prices, mainly driven by US import tariffs, is likely to be short-lived that diminishes need for keeping current monetary policy (which he described as restrictive) for longer period.

He added that some policy adjustments (rate cuts) can be expected in the near future but avoided committing to any specific action by the Fed in coming months.

Fresh acceleration higher (gold was up 1.2% after Powell’s speech) has improved technical picture on daily chart (MA’s turned to bullish configuration and 14-d momentum is about to break into positive territory).

Bounce from strong supports at $3340 (daily cloud top / triangle support line) is pressuring triangle’s upper boundary ($3380), violation of which (daily / weekly close above this resistance) to generate fresh bullish signal and open prospects for further advance towards $3382/$3400 (Fibo 76.4% of $3408/$3311 / psychological).

Weekly close above $3360 (broken Fibo 50%) will be the minimum requirement to keep fresh bulls in play.

Res: 3380; 3385; 3400; 3408
Sup: 3371; 3360; 3351; 3342