Gold has dipped below $ 4,600 per ounce today; however, at the time of writing, it is attempting to reclaim this level. Silver has decreased by 0.6% to $68.83, and both platinum and palladium have retreated as well.

Nonetheless, the monthly results remain outstanding. In August, the metal has gained over 13 percent, marking the best performance since January and one of the largest monthly increases of the current century. The unexpected intervention by the U.S. Treasury in the bond market has revived interest in the so-called devaluation trade, which fueled last year's record growth of the metal.

It is noteworthy that the current pullback is characterized by caution ahead of an event rather than a trend change. Investors are awaiting Kevin Warsh's first major speech as Federal Reserve Chair at the Jackson Hole symposium. Warsh's statements may directly shape the narrative and calm market sentiment, so investors are likely to exercise caution ahead of his speech.

The division within the Fed over whether to raise rates over the coming months remains principled, and the outcome of this debate will determine the fate of the metal. Importantly, on Thursday at Jackson Hole, two regulators stated that the Fed's policy is not restraining the U.S. economy, even as inflation continues to exceed the 2 percent target, and urged colleagues to take action soon. Conversely, Boston Fed President Susan Collins pointed to evidence suggesting that rates are moderately restrictive. Recall that in July, three committee members voted against keeping the rate unchanged, advocating for a quarter-point increase.

The situation is such that gold has risen 13 percent over the month, not so much due to expectations of rate cuts as due to doubts about the stability of American finances. Therefore, the market's reaction to Warsh's speech may be nonlinear. Hawkish rhetoric will be interpreted as a stimulus for increased selling and the buildup of short positions in the non-yielding metal. Conversely, if the market interprets the statements as an acknowledgment that the Fed cannot control yields, the effect may be the opposite. That is why today will be a test not only for monetary expectations but also for the very nature of the current gold rally.

Regarding the current technical picture of gold, buyers need to break through the nearest resistance at $4,609. This will allow them to target $4,673, above which it will be quite challenging to break through. The most distant target will be around $4,720. In the event of a decline, bears will attempt to take control over $4,540. If they succeed, a breakout below this range will deal a serious blow to bull positions and push gold down to a low of $4,481, with the prospect of reaching $4,432.