Gold trades weak, market eyes FED policy
- Gold declined from the high of $1278 made yesterday on account of stable US dollar. Market awaits Fed policy decision meeting to be held today.
- Fed is expected to be keep its interest rates unchanged and major event for the week is Fed chairperson to be appointed by Donald Trump. The House Republicans to release draft of legislation on tax reform tomorrow is also main event for Dollar bulls.
- Major economic data to be released today is US ADP employment and ISM manufacturing data.
- US Dollar index has shown a minor jump from the low of 94.45. The index is facing strong resistance at 95.20 (161.8% fibo) and any break above targets 96/96.51 level. It is currently trading around 94.70. The pair is facing major support near 94.25 (7- day MA) and any break below confirms minor weakness till 93.58 (55- day EMA)/92.60 likely.
- Technically gold is facing near term resistance around $1278 (10- day MA) and any break above will take the pair to next level till $1284/$1291. Overall bullish continuation can be seen if it closes above $1298(50- day MA).
- Gold’s near term support is around $1262 (61.8% retracement of $1204 and $1357.90) and break below will drag the commodity down till $1250.The yellow metal should close below $1250 for major trend reversal.
It is good to sell on rallies around $1276-$1278 with SL around $1284 for the TP of $1262/$1250.
Our chart for the call today
Take a look at our yesterday update again: