Gold (XAU/USD) is cheering the dovish Federal Reserve decision as inches back closer to monthly tops. A move beyond the $1760-65 hurdle is set to pave the way for additional XAU/USD gains, FXStreet’s Haresh Menghani reports.
See – Gold Price Analysis: XAU/USD to suffer a fall towards $1670 – Credit Suisse
Key quotes
“The FOMC on Wednesday downplayed speculations that an improvement in the outlook could force the central bank to unwind its stimulus. The so-called ‘dot plots’ indicated that the Fed was in no rush to raise interest rates at least through 2023.”
“The Committee upgraded its assessment of the current state of the economy and the median GDP forecast stood at 6.5% for the current year. This would mark the largest annual jump in GDP since 1984 and a whopping 2.3% upgrade from its estimates in December.”
“A subsequent strength above previous strong support now turned resistance near the $1760-65 horizontal zone will reaffirm the bullish outlook. The XAU/USD might then accelerate the momentum towards the $1785-88 intermediate resistance before eventually aiming back to reclaim the $1800 mark.”
“Dips toward the $1742-40 resistance breakpoint might now be seen as a buying opportunity. This, in turn, should help limit the downside near the $1730 region. This coincides with a one-and-half-week-old ascending trend-line support, which if broken decisively will negate any near-term positive bias. The commodity might then turn vulnerable to break below the $1700 mark and challenge multi-month lows, around the $1677-76 region set earlier this month.”
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