Gold looking for commentary on monetary policy today
XAUUSD
Technical Overview:
Pivot: 1202.20 (CMP 1199)
Key Resistance: 1200.10 - 1203.45 - 1207.66 - 1210.20
Key Support: 1196.35 - 1193.79 - 1191.55 - 1189.25
Technical Indicator:
Moving Average: SMA 55 (1199.66) strong resistance & SMA 100(1194.48) & SMA 200(1195.36) strong support today for Gold. According to high volume moving indicator shows upside bias.
RSI: The indicator shows downside momentum, moving around 50 level.
Technical Trade Idea:
Most Likely Scenario: short positions below 1202.20 with targets at 1194.55 & 1189.25 in extension.
Alternative scenario: above 1202.20 look for further upside with 1205.20 & 1208.55 as targets.
Overall,Two factors likely contributed to the market’s weakness on Wednesday. Firstly, an easing of tensions between Italy and the European Union encouraged investors to dump their safe-haven long positions. Secondly, a soaring U.S. Dollar pressured foreign demand for dollar-denominated gold.
The U.S. Dollar was supported early in the session on Wednesday after the ADP National Employment Report showed private payrolls jumped by 230,000 jobs in September, posting its largest gain since February.
Shortly after the release of the jobs data, the greenback extended its gains after the Institute for Supply Management’s (ISM) non-manufacturing activity index jumped 3.1 points to 61.6 last month, the highest reading since August 1997.
Fed Chair Jerome Powell also made supportive comments. He added to the bullish tone for the U.S. Dollar when he said on Wednesday that the central bank may raise interest rates above an estimated “neutral” setting as the “remarkably positive” U.S. economy continues to grow.
In other news, tensions eased in Europe on Wednesday on reports that Italy plans to reduce its budget deficit over the next three years.
While the long-term view remains bearish because of the hawkish Fed, gold does remain vulnerable to short-term upswings if the situation between Italy and the European Union escalates.
In the U.S. on Thursday, investors will get the opportunity to react to three more economic reports and a speech from a U.S. FOMC member.
FOMC Member Randal Quarles is also scheduled to speak. Investors will be looking for commentary on monetary policy especially his opinion on inflation and the labor market. He may also offer his opinion on the pace of future interest rate hikes.
Thanks
YoCryptoManic