Gold retreats after being unable to break above $1250

Gold off highs amid a recovery of the US dollar and despite a negative in tone in Wall Street.
Price tested the $1250/oz area but again failed to break higher.

Matías Salord FXStreet

Gold is trading at $1,247/oz, practically flat for the day. Hours ago reached the highest level in a week at $1,250.20. The area around the critical $1,250 level capped the upside and price retreated. It found support at $1,245.

The move away from the highs took place amid a recovery of the greenback across the board. The dollar remains in negative territory against most of its rivals but trimmed losses significantly.

The Federal Reserve started today it's 2-day meeting. A 25 bp rate hike is expected to be announced tomorrow. However, attention will likely focus on the FOMC projections that could have a significant influence on the US dollar.

XAU/USD Levels to watch

To the upside, if gold rises and holds on top fo $1,250 it could point to further gains. The next resistance levels might lie at $1,254 and $1,261. On the flip side, supports could be seen at $1,244 (daily low), $1,240 and $1,235 (20-day moving average).

Author

Matías Salord

FXStreet

Matías started in financial markets in 2008, after graduating in Economics. He was trained in chart analysis and then became an educator. He also studied Journalism. He started writing analyses for specialized websites before joining FXStreet.

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