Gold has been making its way higher, trading above $1,950, after the initial volatility from Federal Reserve Chairman Jerome Powell's speech calmed down. In the aftermath of the choppy action, markets have adopted the narrative that the Fed's shift to allowing inflation to overheat is still meaningful – even though it has no imminent implications on policy.

Allowing consumer prices to rise and keeping rates low is music to the ears of those clinging to precious metals. 

The Currency Pair XAU USD has been on the rise. How is it positioned now? 

The Technical Confluences Indicator is showing that gold's first soft cap is $1,958, which is the convergence of the Bollinger Band 15min-Middle, the Simple Moving Average 5-15m, and the SMA 5-1h. 

Further above, the upside target is $1,976, which is where the Fibonacci 61.8% one-week and the previous daily high converge. 

Support is at $1,951, which is the confluence of the Fibonacci 61.8% one-day and the Fibonacci 38.2% one-week. 

Further down, strong support awaits at $1,935, which is the convergence of the Fibonacci 38.2% one-day, the BB 4h-Middle, the Fibonacci 23.6% one-week, the SMA 5-one-day, and the SMA 200-4h.

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SOURCE: This news has been posted originally on fxstreet