Gold waits on FOMC

For gold investors the break of the strong resistance at $1340 is hugely significant, a move that has been helped by a weaker USD as the precious metal now tries to push on towards the $1400 price point where, as I mentioned in my previous post, a further band of strong price resistance awaits and is also a region from which gold has pulled back on a number of occasions.

Moreover, today also sees the FOMC minutes which despite severe weather are expected to be released on time although the press ‘lock up’ allowing journalists to write their reports at the same time as the minutes are released has been cancelled.  However, what traders and investors will be watching for in the minutes primarily is whether the current cycle of interest rate hikes is coming to a pause or not.  And in terms of the USD the 96 price point on the DXY is the level to watch as it not only represents strong support and has also today provided the index with a small bounce, so any significant break on the back of dovish minutes would certainly give gold a further boost higher.

By Anna Coulling