Gold Price Analysis: XAU/USD climbs to three-week tops, above $1,745 ahead of Powell

• Sliding US bond yields undermined the USD and assisted gold to regain traction on Thursday.
• Acceptance above 200-period SMA on the 4-hour chart supports prospects for further gains.
• A sustained move beyond the $1,760-65 hurdle will confirm a bullish double-bottom breakout.

Gold held on to its intraday gains near three-week tops and is now looking to build on the momentum further beyond the $1,745-46 resistance zone.

A fresh leg down in the US Treasury bond yields undermined the US dollar, which, in turn, extended some support to the dollar-denominated commodity. That said, the underlying bullish sentiment kept a lid on any further gains for the safe-haven XAU/USD. Investors also seemed reluctant and preferred to wait for Fed Chair Jerome Powell's speech before placing any aggressive bets around the non-yielding yellow metal.

From a technical perspective, acceptance above 200-period SMA on the 4-hour chart supports prospects for an extension of the recent bounce from multi-month lows, around the $1,677-76 region, which constituted the formation of a bullish double-bottom. The constructive outlook is reinforced by the fact that oscillators on hourly charts have been gaining positive traction and just moved into the bullish territory on the daily chart.

Hence, a subsequent towards a previous strong support breakpoint, around the $1,760-65 region, looks a distinct possibility. Some follow-through buying will validate the double-bottom breakout and set the stage for additional gains. The XAU/USD might then accelerate the momentum towards an intermediate hurdle near the $1,782 region before eventually aiming back to reclaim the $1,800 round-figure mark.

On the flip side, the $1,735 level and the overnight swing lows, around the $1,730 region now seems to protect the immediate downside. This is closely followed by the $1,720 horizontal support. Failure to defend the mentioned support levels will negate any positive bias and turn the XAU/USD vulnerable to challenge the $1,700 mark. The downward trajectory could further get extended back towards challenging the $1,677-76 support zone.

Gold 4-hour chart

Technical levels to watch