GOLD tests critical 38.2% Fibo support as Fed meeting looms
Gold stalls a two-day downtrend as safe-haven demand returns ahead of the Fed meeting.
US Dollar hits weekly lows on dovish Fed bets, easing US-China trade concerns.
Gold looks to regain the 21-day SMA at $4,061 as the 38.2% Fibo level at $3,973 holds fort.
Gold is revering a part of the previous decline, challenging the $4,000 mark as safe-haven flows return heading into the two-day US Fed monetary policy meeting.
Markets seem to have turned risk-averse, biding time before the Fed policy announcements on Wednesday. Further, nervousness sets in as key US tech titans are due to release their earnings reports later this week.
Meanwhile, the USD is languishing in weekly lows against its six major currency rivals, as traders look to reposition amid the US-China trade deal optimism and ahead of the Fed event risk.
These factors offer fresh support to Gold, helping the bright metal stage a comeback after having fallen for two trading days in a row.
Gold tumbled over 3% on Monday, as markets ignored the traditional safe haven in search of higher returns on renewed hopes that the US and China will reach a trade deal when US President Donald Trump and his Chinese counterpart Xi Jinping meet on Thursday in South Korea.
All eyes are now on the Fed’s monetary policy verdict and the daily technical setup for fresh trading impetus, as the US government shows no signs of reopening.
Markets are almost fully pricing in two interest rate cuts this year, with a 25 basis points cut seen on Wednesday. Therefore, the main focus will be on the language in the policy statement and Fed Chairman Jerome Powell’s words for fresh hints on the central bank’s path forward on rates.
Daily technical analysis
The daily shows that Gold price defends the critical support at $3,973, which is the 38.2% Fibo level of the parabolic rise that kicked off in mid-August.So long as the abovementioned level is held, Gold buyers will likely remain hopeful.
Meanwhile, the 14-day RSI flirts with the midline, struggling to find acceptance above it.If the 50 level is reclaimed on a sustained basis, Gold’s rebound could gather traction toward the 21-day SMA at $4,061.
Recapturing the latter is critical to stretch the recovery to near the $4,100 hurdle, where a bunch of healthy resistance levels align.
Additional upside will challenge the $4,150 psychological barrier.
Conversely, a daily candlestick closing below the 38.2% Fibo support at $3,973 will initiate a fresh downtrend toward the 50% Fibo level of $3,847.
Further south, the upward-sloping 50-day SMA at $3,784 could rescue buyers.
GOLD tests critical 38.2% Fibo support as Fed meeting looms
Gold is revering a part of the previous decline, challenging the $4,000 mark as safe-haven flows return heading into the two-day US Fed monetary policy meeting.
Markets seem to have turned risk-averse, biding time before the Fed policy announcements on Wednesday. Further, nervousness sets in as key US tech titans are due to release their earnings reports later this week.
Meanwhile, the USD is languishing in weekly lows against its six major currency rivals, as traders look to reposition amid the US-China trade deal optimism and ahead of the Fed event risk.
These factors offer fresh support to Gold, helping the bright metal stage a comeback after having fallen for two trading days in a row.
Gold tumbled over 3% on Monday, as markets ignored the traditional safe haven in search of higher returns on renewed hopes that the US and China will reach a trade deal when US President Donald Trump and his Chinese counterpart Xi Jinping meet on Thursday in South Korea.
All eyes are now on the Fed’s monetary policy verdict and the daily technical setup for fresh trading impetus, as the US government shows no signs of reopening.
Markets are almost fully pricing in two interest rate cuts this year, with a 25 basis points cut seen on Wednesday. Therefore, the main focus will be on the language in the policy statement and Fed Chairman Jerome Powell’s words for fresh hints on the central bank’s path forward on rates.
Daily technical analysis
The daily shows that Gold price defends the critical support at $3,973, which is the 38.2% Fibo level of the parabolic rise that kicked off in mid-August.So long as the abovementioned level is held, Gold buyers will likely remain hopeful.
Meanwhile, the 14-day RSI flirts with the midline, struggling to find acceptance above it.If the 50 level is reclaimed on a sustained basis, Gold’s rebound could gather traction toward the 21-day SMA at $4,061.
Recapturing the latter is critical to stretch the recovery to near the $4,100 hurdle, where a bunch of healthy resistance levels align.
Additional upside will challenge the $4,150 psychological barrier.
Conversely, a daily candlestick closing below the 38.2% Fibo support at $3,973 will initiate a fresh downtrend toward the 50% Fibo level of $3,847.
Further south, the upward-sloping 50-day SMA at $3,784 could rescue buyers.
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