Gold's Bearish Trend: Will Powell's Speech Trigger Further Declines? | Analyzing Market Sentiment & Technical Indicators

The precious metals complex displayed divergent performance last week, with gold surrendering 1.3% while silver managed a modest 0.6% gain. This divergence underscores the unique pressure points affecting gold specifically, particularly its sensitivity to interest rate expectations and dollar strength.

The catalyst for gold's latest leg down came from surprisingly robust US retail sales data, which showed a 0.7% month-over-month increase in July - nearly double consensus estimates. This economic resilience immediately translated into:

• 20 basis point surge in the dollar index
• 10-year Treasury yields hitting October 2022 highs
• Gold breaking below the psychologically important $1900 level

CFTC commitment of traders data reveals an intriguing battlefield developing in gold futures:

This positioning suggests two distinct trader cohorts:

1. Contrarian bulls establishing positions at perceived value levels
2. Momentum traders adding to shorts on technical breakdowns

Multiple technical indicators currently align to paint a concerning picture for gold enthusiasts:

• 60-day moving average sloping downward
• RSI at 33 (below neutral 50 level)
• MACD showing bearish crossover below signal line

Key price levels to monitor:

Resistance: $1905 (recent breakdown level), $1930 (50-day MA)

Support: $1885 (August low), $1805 (March 2023 low)

All eyes now turn to the Jackson Hole Economic Symposium, where Fed Chair Powell's remarks could provide critical guidance on:

• The potential for additional rate hikes
• Timeline for maintaining restrictive policy
• Assessment of inflation progress

Market participants should prepare for potential volatility around these key events, with gold's direction likely being determined by the Fed's communicated policy path.