Gold Consolidating Around a Significant Support Level

The price action of gold is currently consolidating around the 61.8 per cent Fibonacci retracement level at 1780.92. A potential breakdown below it could lead to a test of the previous swing low at 1758.65, whereas a rebound from it could be followed by another attempt at penetrating above the 200-day MA (in red), currently underpinning the resistance level at 1808.00.

The price action did not react markedly to FED Chair Powell's testimony from yesterday, which underpins the indecisiveness of the market. Traders should be especially careful if they decide to open any positions when the underlying sentiment is so unpredictable.