- Investors looked past Wednesday’s hawkish rate cut by the Fed.
- Weaker USD/cautious mood helped regain some positive traction.
- Technical set-up warrants caution before placing aggressive bets.
Gold edged higher through the early European session on Thursday and is currently placed at session tops, back closer to the key $1500 psychological mark.
A combination of supporting factors helped the precious metal to quickly reverse an early dip to the $1489 region and build on the overnight late bounce from over one-month lows, touched in reaction to a rather hawkish FOMC monetary policy statement.
Rebounds from the post-FOMC lows
It is worth reporting that the Fed lowered policy rate by 25 bps, as was widely expected, but the language of the accompanying policy statement raised questions if there will be another rate cut this year and exerted some downward pressure on the non-yielding yellow metal.
The so-called dot-plot showed that the median projections of federal funds rate remained at present levels through the end of 2020. Moreover, several dissenting votes suggested that the Fed is already done with its mid-cycle adjustments and further rate reductions were not guaranteed.
Meanwhile, the US Dollar failed to capitalize on the overnight goodish intraday up-move and traded with a mild negative bias on Thursday. This coupled with a cautious sentiment underpinned demand for traditional safe-haven assets and extended some support to the dollar-denominated commodity - Gold.
From a technical perspective, the commodity on Wednesday finally broke through a 3-1/2-month-old ascending trend-line support but continued showing some resilience below the 23.6% Fibo. level of the $1270-$1557 bullish move to multi-year tops, warranting some caution before placing any aggressive directional bets.
Technical levels to watch
|Today last price||1498.5|
|Today Daily Change||4.37|
|Today Daily Change %||0.29|
|Today daily open||1494.13|
|Previous Daily High||1511.1|
|Previous Daily Low||1484.56|
|Previous Weekly High||1523.3|
|Previous Weekly Low||1484.9|
|Previous Monthly High||1554.63|
|Previous Monthly Low||1400.9|
|Daily Fibonacci 38.2%||1494.7|
|Daily Fibonacci 61.8%||1500.96|
|Daily Pivot Point S1||1482.09|
|Daily Pivot Point S2||1470.06|
|Daily Pivot Point S3||1455.55|
|Daily Pivot Point R1||1508.63|
|Daily Pivot Point R2||1523.14|
|Daily Pivot Point R3||1535.17|
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