The price of Gold is holding within a consolidative pattern ahead of the FOMC news. Will the price break higher?
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The price of Gold is seasonally bullish, and the price has recently found support at the monthly range lows. However, since the bullish rejection move, the price has begun to consolidate above the broken highs. This could suggest that buyers are happy to hold positions here ahead of the FOMC news tomorrow. The Fed will hike by 75bps tomorrow which could be priced into the market, causing the USD to weaken.
If the USD does weaken tomorrow and these current lows hold, we could see a breakout higher. Once the price has broken a move back to the recent swing lows at $1800.00 would be the next level of interest. If the price remains bullish through August we could see a move back to the highs of the monthly range. This will all depend on the outcome of the Fed, if they hike 75bps but suggest the next hikes will be smaller, the USD strength could turn. This would support a move higher on the monthly chart for Gold.
Did you see our AUDUSD analysis? You can see it here.
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