According to analysts at TD Securities, the market is interpreting Powell’s remarks as an openness to rate cuts, helping gold prices firm as the Fed Chair signaled support to a growing chorus of investors calling for a rate cut.

Key Quotes

“At the same time, CTAs are still buying gold, as firming momentum signals kick off a surge in interest for the yellow metal and friends. Benefiting from their positive correlations to gold, silver and platinum prices managed to break north of levels required to trigger a significant round of buying from algorithmic trend followers.”

“And — silver prices are challenging yet another key trigger which could see implied target positioning turn firmly positive. However, both will have to see the additional interest more than offset the downside pressure from their industrial components, as whipsaw risks remain particularly high for these two metals. Nonetheless, for the moment, CTAs are set to pursue short covering north of $14.94/oz and $822/oz respectively.”