Gold prices adding 0.62% at $1,504 after Fed cut its benchmark interest rate for the third time in row this year. As I mentioned yesterday in “Gold Price Seesaw Around $1,490 Ahead of Fed Decision”, lower interest rates will pressure USD and US bond yields and will support gold prices. U.S. Gross Domestic Product for Q3 expanded at a 1.9%, slowing from 2% in the Q2 but came in above market forecasts for growth of 1.6%.
Gold helped last week by weaker US macro data which further increased the bets on an interest rate cut by Fed. The ECB kept interest rates unchanged and continued its bond repurchase program of €20billion per month.
Gold tested the support from the ascending trendline at $1,483 and managed to breach the 20-day moving average first and then the 1,500 mark giving bulls the upper hand. On the upside, first resistance would be met at $1,505.81 today’s top while a move above will open the way for a move up to 1,5017.91 the high from October 25th.
On the downside, first support for gold now stands at $1,500 round figure and then at $1,493.51 daily low. Gold has established strong support at $1,458 October low. The precious metal remains well supported by weak global economic data, low-interest rates environment and tensions in Syria and Middle East.Download our latest quarterly market outlookfor our longer-term trade ideas.
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