The minutes of the Fed's meeting on 17 Aug showed that they signaled no pause in rate hikes until inflation fell sharply. The wording was slightly tougher than the market expected. Also, a number of Fed officials issued hawkish remarks for two consecutive weeks, which stimulated the US dollar to strengthen and closed above 108 again. As a result, the price of gold fell, and it can be seen that the Fed's focus is still on inflation. This also fully demonstrated the Fed's determination to reduce the inflation rate to 2%, which led to a sharp continued rise in the US dollar index, and price of gold fell for 6 consecutive days.

According to the latest information released by the US Commodity Futures Commission (CFTC), speculators continued to increase their net long dollar positions because of the rising interest rate expectations. The net long dollar positions climbed to US$13.3 billion as of 16 Aug from US$12.9 billion in the previous week, which is the first increase since August. The gold ETF holdings have been reduced to 980 tons since 1 August, and the strength of the dollar continues to weigh on gold bulls.

The recent technical picture has shown that the price trend of gold is biased towards bearishness. Last month's bearish view of gold's 1,780 - 1,800 position was established, and then began with a falling pattern that a large black candlestick in a reversal pattern was shown on the weekly chart. However, it is currently in a small upward trend in terms of the daily chart. As shown in Figure 1, there is support after falling to around 1,728 - 1,730, which happens to be the support of 0.618 in the rising segment of the daily chart. Therefore, it is expected to rebound up to the short-term target of 1,775 - 1,780 in the short term and then continue to decline.

In the medium term, the overall trend remains weak. The current bulls and bears are fighting around 1,750 - 1,760. If it breaks to the upside, it is expected to reduce the trend of further downside. Otherwise, the former low of 1,680 will remain a target for the short. In the big picture, gold is still in the lower high lower low, as shown in Figure 2. Unless the chart first goes out of a higher high and the previous high point of the daily chart is near 1,800, it will increase the bullish signal in the market outlook once this position is unexpectedly recovered. Otherwise, it will continue to be weak.

Hugo Leong Gold Analyst of Hantec Group