The FOMC meeting did not put pressure on the precious metal at yesterday's session. Gold closed with marginal gains well managing to hold above the support level.
The yellow metal has been unable to prove its safe haven status during the Greek crisis. The FOMC meeting delivered strong signals for the rate hike this year. In this case, the metal's reaction will be mild positive. Next days we can observe divergence in the price movement of the precious metal.
Barclays and Blackrock expect the rate hike to take place in September, but Goldman Sachs and BNP Paribas expect it in Decmeber. Finally, the rate hike seems imminent.
Technical view: The yellow metal was trading at $1,096.80 during today's Asian session compared to Tuesday's closing price of $1,096.70. The weekly trading pattern is framed between $1,085.00 and $1,119.00 on a closing basis. A close on either side will lead to more room to trade. On the weekly chart, the metal managed to hold the channel support trendline at $1,085.00 on a closing basis. The metal has been reaching lower highs and lower lows breaking below the large bearish head & shoulder pattern.
The weekly support is found at $1,085.00, $1,077.00 and $1,073.00. In case of a weekly close below $1,085.00, gates to $1,068.00, $1,045.00, and $1,005.00 will be open. On the monthly chart, strong support zone is seen between $1,045.00 and $1,032.00. The metal fell below the 14-year ascending trendline on the monthly chart. It has been managed to close above $1,085.00 on a daily closing basis for eight consecutive days.
Intraday: Intraday support is at $1,095.00,$1093.00 and $1,090.00. Resistance seems to be at $1,1100.00,$1,106.00 and $1,110.00 levels. In case of a daily close below $1,085.00, gates to $1,077.00 initially and later towards $1,055.00 will be open.
The metal has been making higher lows on the H1 chart with preparing strong base at $1,090.00 and $1,085.00.
After a month time, the metal made a higher high on the H4 chart.
Intraday selling is below $1,090.00 and $1,088.00 initially. Selling accelerates below $1,085.00 towards $1,082.00, $1,080.00 and $1,077.00. Panic likely to be triggered below $1,077.00. Use a rise to sell . Buying ais vailable above $1,100.00, target is at $1,102.00 and $1,104.00. A strong pullback is likely to take place above $1,106.00 towards $1,109.00 during a day.
A daily close is above $1,110.00. Bulls aim at $1,118.00, but chances are remote. As of now, the trend favours a pullback with SL $1,090.00. Risky traders can use a dip to buy with SL $1,090.00. The target is at $1,107.00, $1,110.00, and, in the extreme case, $1,117.00.
To contact the author of this analysis, please email: joseph.wind@analytics.instaforex.com
