Gold Sideways Ahead of FOMC – Bearish Butterfly in Highlights
Arslan Butt • 1 min read
Fellas, the yellow metal gold is trading sideways as the markets await the conclusion of the Federal Reserve’s two-day meeting. However, the choppy session is helping us secure good and quick trades in gold.
FOMC vs. GOLD
Ahead of Fed’s rate decision, the market is mostly muted, as major investors stay out before the FOMC rate today. Overall, the market does not anticipate any changes to be made to interest rates when the Fed’s decision is announced later today Wednesday. However, the chances are high that the US central bank will open the door for rate cuts later this year.
Gold – Technical Outlook & Bearish Butterfly
On the 4-hour chart, gold has formed a bearish butterfly pattern which is suggesting solid chances of a bearish reversal. Gold has already completed the CD wave around $1,358 and has closed a couple of candles below the same level, which suggests high chances of sell-off.
As you know, the market is all about FOMC today, and it may also help us determine the long term trend in gold. Below $1,358, gold can continue to trade lower until $1,326. While bullish breakout of $1,350 can extend the buying trend until $1,360 and $1,371.