Gold price on the XAU/USD chart has given up the gains for the day after a surprisingly hawkish FOMC minutes hit the newswires.
According to the FOMC minutes, some officials see discussions on tapering coming up in subsequent meetings, despite the US economy still being far from the FOMC’s set goals. The minutes also indicate that the FOMC could moderate the pace of asset purchases if the economy keeps moving towards recovery.
The markets see these as a sign that the Fed has at least begun to consider discussing tapering, which was initially thought to be off the table entirely.
Gold price was trading slightly lower as of writing.
Technical Outlook for Gold Price
The sudden strengthening of the USD in response to the hawkish FOMC minutes means that the gold price has shed all of Wednesday’s gains and has violated the 1860.77 support. This violation has been repelled, keeping the price above 1860.77 and preserving the sanctity of this support. However, a breakdown of the support will lead to a corrective decline towards the 1840-1828 price wall, acting as a support. Only if this wall breaks down can bears hope to achieve the 1815.20 pivot.
On the other hand, a bounce off 1860.77 allows the gold price to target the 1881.68 price mark. Above this level, additional barriers are found at 1900.95 and 1930.88.