- Bulls, so far, have managed to defend a 3-1/2-month-old ascending trend-line support.
- Neutral set-up warrants caution before placing any aggressive near-term directional bets.
- All eyes remain glued to the highly anticipated FOMC decision, due later this Wednesday.
Gold extended its sideways consolidative price action through the early European session on Wednesday and was seen pivoting around the key $1500 psychological mark, awaiting FOMC policy decision.
The precious metal has repeatedly bounced off a 3-1/2-month-old ascending trend-line, which coincides with 23.6% Fibo. level of the $1269-$1557 up-move and should act as a key pivotal point for short-term traders.
Meanwhile, neutral technical indicators on hourly/daily charts haven’t been supportive of any firm near-term direction and warrant some caution before placing any aggressive directional bets ahead of the key event risk.
The mentioned confluence support is closely followed by 50-day SMA, which if broken decisively will confirm a bearish breakdown and set the stage for an extension of the recent corrective slide from multi-year tops.
Below the mentioned support, currently near the $1480 region, Gold is likely to accelerate the downfall further towards challenging a previous horizontal resistance breakpoint, now turned support near the $1450-46 region.
On the flip side, any meaningful move up is likely to confront some fresh supply near the $1512 region ahead of the post-ECB volatility swing high near the $1522-24 area, above which the commodity might aim back towards multi-year tops.
Gold daily chart
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