Gold Crosses Over $1,750 – Dovish FOMC Underpins XAU/USD
Skerdian Meta • 1 min read
After falling to approximately $1,754.00 in the early Tokyo session, the gold price (XAU/USD) has sought to recover. The precious metal XAU/USD remained sideways on Thursday because of lower trading as US markets were closed for Thanksgiving. Given that the market is optimistic, the gold price is expected to keep going up and reach an important $1,760. The USD index (DXY) has been oscillating below the round-level resistance of 106.00.
The US dollar is expected to touch a three-month low of 105.34 as the Federal Reserve (Fed) abandons the larger rate rise agenda at its December monetary policy meeting. Meanwhile, the S&P 500 futures made modest gains in the holiday session as the market remained positive.
According to the Federal Open Market Committee (FOMC) minutes, most Fed policymakers prefer slowing the current rate rise pace. This might keep gold prices in check. ANZ Bank, on the other hand, holds a different viewpoint. They believe lower-than-expected US inflation caused a dollar sell-off, allowing gold prices to recover. This is unlikely to last, as inflation is at 7.7%, much above the central bank’s 2% target. “It is not enough for the Fed to be sure that inflation will return to 2% in the long run.”
Gold Technical Outlook
The gold price begins today’s trading favorably, approaching our initial hoped-for goal of $1,765.00, with the EMA50 providing consistent support. A break of the indicated level would confirm the bullish wave’s extension to $1,786.50.
As a result, the bullish trend scenario will continue to be valid for the foreseeable future, with a breach of 1746.40 signaling the end of the projected increase and a return to the corrected bearish track.
Today’s trading range is likely between $1,745 support and $1,780 resistance.
Today’s projected trend: bullish