Gold – Hawkish Fed minutes dampen near-term sentiment further

Gold prices remain in the red for the third consecutive day, hitting their lowest point since May 15 during the early European session on Thursday, extending Wednesday’s 1.75% drop.

The Fed minutes, released late Wednesday, indicated that the US central bank expects inflation to cool further over time but left the possibility of additional tightening if conditions deteriorate.

Markets interpreted the latest message from US policymakers as a hawkish signal, which boosted demand for the dollar and pressured gold prices downward.

Despite the fresh dips weakening the near-term structure, the overall daily chart remains bullish. This suggests that the pullback from the new record high ($2450, posted on May 20) is a healthy correction before bulls regain full control.

Strong supports at $2343/32 (Fibo 61.8% of the $2277/$2450 uptrend / top of the thick daily Ichimoku cloud) should contain the dips and maintain a higher bias in the near term. However, a return above the pivots at $2391/$2400 (daily Tenkan-sen / psychological level) will be required for confirmation.

Conversely, a loss of the $2343/32 support levels would open the way for a deeper correction, exposing the next targets at $2318/$2300 (Fibo 76.4% / psychological level), which guard key near-term supports at $2277/72 (May 3 low and floor of the recent consolidation range, Fibo 38.2% of the $1984/$2450 uptrend).

Only a firm break below these levels would sideline the larger bullish trend and generate an initial reversal signal, completing a double-top pattern at $2431/50.

Res: 2391; 2400; 2413; 2433
Sup: 2343; 2332; 2300; 2277