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Fundamentals

During the Asian session on Wednesday (June 21), spot gold rebounded slightly and is currently trading around 1935. Gold prices fell sharply overnight, once touching the 1930 level, which is mainly due to the strong U.S. Housing Starts data. Also, two current Fed governors and one governor nominee said they are focused on reducing excessive inflation, which weighed significantly on gold prices. For short-term investors, all that needs to be concerned is what Jerome Powell, the Federal Reserve Chairman, says at the Congressional hearings tonight. If Powell continues to deliver a hawkish speech, the rally in gold prices may be blocked, but the room below is also very limited. For today, it is still recommended to buy low and sell high around key points, with an intraday reference range of 1930-1950.

Data: New housing starts totaled 1.631 million at an annualized rate in May, a record high since April 2022, compared to 1.4 million expected and revised to 1.34 million previously; building permits reached 1.491 million, compared to 1.423 million expected and revised to 1.147 million previously.

What investors need to focus on today is Fed Chairman Powell's speech at the congressional hearing.

Overall, the trend of gold, despite turning from oscillating strength to oscillating weakness on Tuesday, with a fall to 1930, did not break new lows, nor was there a unilateral pattern of extremely weak decline. Therefore, keeping bearish on Wednesday also just depends on the previous low, the 1930 or 1925 low, but technically is not optimistic that the price can come out of the plunge space on Wednesday. The decline in price yesterday was still big before the fundamentals were clearly looking bearish. This may be the early overdraft down act of the market on Powell's speech, which may be negative for gold expectations, if so then there will be some disadvantages for the later operation. Focus on the impact of Fed officials' speeches on the market continues today, however, the space is highly limited.

Technical Analysis

Daily level: the MAs of 5, 10, and 20 days are aligned down with a small unilateral trend. As the intraday suppression is quite evident, focusing on the resistance points 1940 and 1950 above. That is, if the gold does not stabilize in 1940, it is going to continue in a state of extreme weakness. The price plunged on Tuesday. According to the coherence, one can continue to go short on Wednesday, with consideration of the 1940-1945 range. However, as a lot of down space has been seen yesterday, the space to fall again today will also be compressed. We can temporarily look at the range around 1930 before setting up the operation. If the negative fundamentals cause gold to fall below 1930, then attention will be paid to the 1918 level of support below.

Intraday operation: today's market will not be a clear unilateral shorting, and the price is either weakly oscillating or oscillating rebound. For intraday trading, there is 1925-1930 support below and 1940-1945 resistance above. As the price currently stands on the 1935 level, with key points up and down, it is recommended to try to choose the key points to participate. After the price continues to retrace to the 1925-1930 range, one can try to go long with short positions, with stop loss set at 1918 below, and the first target of profit-taking at 1945; after setting up the preserved capital single, the second target will be at 1955 level.

Trading Recommendations

Trading direction: Long

Entry price: 1925

Target price: 1945

Stop loss: 1915

Support: 1930.000/1918.000

Resistance: 1940.000/1950.000