Gold Price Forecast: XAU/USD sees downside below $1,820, focus shifts to Fed Powell

• Gold price is trading near the demand zone placed in a narrow range of $1,821.45-1,823.57.
• The impact of prohibiting Russian gold exports by the G7 countries is faded now.
• The upbeat US Durable Goods Orders have strengthened the DXY.

Gold price (XAU/USD) displayed a failed attempt to sustain above the critical resistance of $1,840.00 on Monday. The precious metal has turned sideways after a sheer downside move and is expected to extend its losses after violating the crucial support of $1,820.85. It looks like the headline of banning Russian gold exports by the G7 countries has lost its significance and investors have started focusing on the solid fundamentals of the US dollar index (DXY) again.

The DXY is hovering below the round-level resistance of 104.00 after displaying a responsive buying action around 103.70. The release of the upbeat Durable Goods Orders has supported the DXY bulls. The economic data landed at 0.7%, higher than the estimates of 0.1% and the prior release of 0.5%.  This has cleared that the overall demand structure in the US economy is rock solid. The demand prospects are resilient despite the headwinds of soaring price pressures.

Going forward, investors’ focus will remain on the speech from Federal Reserve (Fed) chair Jerome Powell, which is due on Wednesday. Fed Powell is expected to dictate the likely monetary policy action of July.

Gold technical analysis

Gold prices are oscillating near the potential demand zone, which is placed in a narrow range of $1,821.45-1,823.57 on an hourly scale. The precious metal is auctioning below the 200-period Exponential Moving Average (EMA) at $1,833.56, which adds to the downside filters. Meanwhile, the Relative Strength Index (RSI) (14) has shifted into a bearish range of 20.00-40.00, which signals that a fresh leg of selling is on its way.

Gold hourly chart