Gold Price Forecast – Gold Continues to Wait For FOMC

Gold Markets Technical Analysis

The gold market has been very quiet in the early hours of Wednesday as we are hanging around the 50-day EMA. The 50-day EMA has been like a magnet for price most of the last couple of weeks, but I think really what’s coming into the purview of the psyche of the market would be the fact that the FOMC meeting is late in the day.

The FOMC is expected to cut interest rates by 25 basis points in the United States, but you also have to understand that the market will be paying close attention to the press conference and the statement to get an idea as to where the Federal Reserve may go. This will have an outsized influence on the gold market and therefore, I think you’ve got a situation where we might get a lot of volatility late in the session. That being said, there is a lot of support underneath that comes into the picture, especially near the $2,600 level, and the uptrend line.

So ultimately, this is a situation where I think if we do drop, there probably are going to be buyers willing to get involved. If we were to break down below the $2,500 level, then we’re talking about wiping out the 200 day EMA and dropping rather drastically. Gold is struggling at the moment, but I think what it’s trying to do is find some type of range in order to trade in.

The FOMC, of course, will have a major influence, but we also have the Bank of Japan and the Bank of England, both having interest rate decisions, which will have an effect as well, not as drastic as the Federal Reserve, but it is still part of the puzzle. I’m still bullish on gold in the longer term. But as we drift into the end of the year, and wait for central banks, I’m not expecting a lot right here, at least nothing sustainable, but a break above the $2720 level then opens up the possibility of the longer term uptrend continue.

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