Gold Price Seesaw Around $1,490 Ahead of Fed Decision
Gold prices seesaw around $1,490 today as the price stabilises after Monday’s sharp fall to 1,490. Federal fund futures show that investors see a 94% chance for a 25 bps interest rate cut by the Fed later today. Falling U.S. interest rate will pressure USD and US bond yields and will support gold prices.
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.
Traders will follow the release of US quarterly GDP; analysts expect the growth to remain at 2.2% for Q3.
Gold trading 0.17% higher at $1,490.01 as the gold price momentum turns negative after the price breached the $1,500 mark and the 20-day moving average at 1,494.
On the downside, first support for gold now stands at $1,486.88 daily low and then $1,483 where the ascending trendline from end of July crosses. Gold has established strong support at $1,458 October low. The precious metal remains well supported by weak global economic data, and tensions in Syria and Middle East.
On the upside, the immediate resistance would be met at $1,494.69 yesterday’s high while a move above will open the way for a move up to 1,504 where the 50-day moving average crosses before an attempt to $1,519 high from October 3rd.Download our latest quarterly market outlookfor our longer-term trade ideas.
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