Gold hit fresh 1-year lows at $1220.90 during the London morning session, as the Dollar Index touched 3-week highs after Fed chair Powell's second testimony. His comments reaffirmed the strength of the domestic US economy despite the disappointing housing data. However, he warned about the risks of the ongoing trade war but the currently bullish Dollar trend will continue to weigh on Gold prices.
Gold continued with its free-fall touching fresh new lows before retesting the $1228.47 resistance level again. The current price is back near the $1222 level and any break to the downside will open the door for the price to touch the $1217 support level. However, extreme oversold conditions have reappeared on the daily chart with a potential divergence between the momentum and the price on the hourly chart that could signal a possible reversal or consolidation before the current trend continues.
Support: 1217 1206
Resistance: 1226.50 1228.47