- The FOMC Meeting Minutes and the US data represent high-impact events.
- The bias is bearish as long as it stays below the downtrend line.
- A new lower low activates more declines.
The gold price slipped lower from yesterday’s high of $1,749. The metal is trading at $1,737 at the time of writing. The XAU/USD dropped as the US dollar rebounded across the board.
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Today, the FOMC Meeting Minutes could be decisive. As you may know, the US reported lower inflation in October. This situation could help the FED to deliver only a 50 bps hike in December.
Still, the November CPI and Core CPI data could give us a clue of what could happen in the next monetary policy meeting. A dovish FED could weaken the USD and help gold jump higher.
Fundamentally, the yellow metal stays lower because the RBNZ increased the Official Cash Rate from 3.50% to 4.25%, as expected. Earlier, the UK and Eurozone manufacturing and services data came in better than expected, while Germany and France reported mixed figures.
Later, the US economic data could really shake the markets. The Flash Services PMI could be reported at 48.0 points above 47.8 in the previous reporting period, while Flash Manufacturing PMI could drop from 50.4 to 50.0 points.
In addition, the Durable Goods Orders, Core Durable Goods Orders, Unemployment Claims, New Home Sales, and Revised UoM Consumer Sentiment will also be released.
Gold price technical analysis: Flag pattern
The XAU/USD dropped within the down channel pattern, and now it hovers above the $1,729 – 32 support zone. The bias remains bearish as long as it stays below the down trendline. Still, only a valid breakdown below $1,729 activates more declines.
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Staying above the support zone and registering a valid breakout through the down trendline could announce a new swing higher. I believe the yellow metal could develop sharp movements after the US data and after the FOMC Minutes.
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