Basic overview
Gold fell slightly below key support yesterday after the FOMC decision as the market saw it as more hawkish than expected.
Overall, apart from a few changes, the Fed was in line with market expectations, and the market's reaction may have been an overreaction. There's a lot of algo-driven noise at big events like this.
The data is the most important thing now because it will decide what the Fed is going to do. It looks like it will only take one soft CPI in January to see the market react dovish with real yields falling and gold rallying.
Gold Technical Analysis – Daily Chart
Gold every day
On the daily chart, we can see that gold fell slightly below the 2600 support
yesterday after the FOMC decision but finally managed to erase some of those losses and rise above the key level. The buyers are likely to rally around these levels to target the 2721 resistance, while the sellers will look for another break below the 2600 support to increase the bearish bets into the next major line of motion
around the 2400 level.
Gold Technical Analysis – Timetable 4 hours
Gold 4 hours
On the 4 hour chart, we can see that we are still trading within the area between support 2600 and resistance 2721 with the zone 2660 as the mid level. We cannot add much more here as the buyers will focus on the 2660 zone first, while the sellers will look for a break below the 2600 support to get more conviction for further downside.
Gold Technical Analysis – 1 Hour Time Table
Gold 1 hour
On the 1 hour chart, we can see that we now have a small downtrend defining the current bearish trend. The sellers will likely continue to position for the break below the support, while the buyers will look for a break higher to increase the bullish bets into the 2660 area. The red lines are explain the average daily range for today.
Catalysts to come
Todaywe get the latest US Jobless Claims numbers, and tomorrow we finish the week with US PCE data.
