As expected, gold has maintained the bullish momentum which drove the price above $1,400 area. The Federal Reserve softened its rhetoric that averted investors away from USD. Thus, investors are flocking to safe haven assets, in particular gold.
Gold has been gaining since the Fed indicated at its meeting last week that it could cut interest rates, possibly as soon as next month. The US central bank intends to subdue the negatives of slowing global growth because of trade tensions and sluggish inflation. The European Central Bank and the Bank of England also sounded more dovish last week. Lower interest rates make safe-haven assets such as gold, which does not yield interest, more attractive while weighing on the US dollar.
Investors tend to seek out gold, seen as a safe-haven asset in times of political or economic uncertainty. The global economy has to deal with a slowdown, thus triggering market volatility. In this context, Gold is winning favor with investors. Meanwhile, the price climbed higher than the dynamic level 20 EMA which is considered as the Mean. As the price always gets back to the Mean level before proceeding further, gold is going to make a pullback towards $1 350 before the price continues its journey towards $1,500 in the coming days.
SUPPORT: 1,300, 1,350
RESISTANCE: 1,400-30, 1,450, 1,500
BIAS: BULLISH
MOMENTUM: VOLATILE
