XAU/USD bears swept off the bulls, will the bulls comeback?

Gold price dropped on Tuesdays to complete the week's opening balance between $1,933 and $1,910 round numbers. The yellow metal fell from a high of $1,930.73 to a low of $1,910.89. Essentially, the market went after the money on the downside following a narrow inside day on Monday ahead of key events for the days ahead. 

US-manufactured capital goods today unexpectedly rose in May, but the prior month's data was revised down. On the Russian front, risks from the short-lived mutiny in the nation appear to have been digested and on the back burner. Meanwhile, traders are looking ahead to Federal Reserve Chair Jerome Powell's speech along with a trove of key economic data on Thursday that could offer clues on future interest rate hikes. 

However, analysts at TD Securities say that they expect that this Friday's Personal Consumption Expenditure report won't corroborate the rates markets pricing of 17bp of hikes in July, particularly as the core PCE services ex-housing measure is likely to post its smallest increase since last July. ''Nonetheless, algos are unlikely to fuel additional upside until prices break above the $2,010/oz mark, suggesting that gold bulls may need discretionary traders to lose faith in the Fed's hawkish tone for prices to resume their upward trajectory.''

Technically, the US Dollar is under pressure on the weekly and daily charts and this could be the fuel for the Gold bugs. On the Gold weekly chart, we have seen a downside extension that could have made a low and thus, the focus is on the upside. a 38.2% Fibonacci retracement of the latest downside impulse's range on the weekly chart marries up with a 50% mean reversion area on the daily chart into trendline resistance around $1,938/39. If the USD continues to deteriorate, this could lead to a double bottom on Gold's daily chart.