Gold prices fell slightly yesterday, Wednesday, after the release of data and statements of the US Federal Reserve, which were highly anticipated, and which came mostly according to expectations, and did not cause any strong tremors in the market.
The conclusion is that the US Federal Reserve will soon start reducing the size of the quantitative easing program (asset purchase) without a specific date for that, with reference to the next meeting in November to clarify this.
The thing that drew the attention of the markets and pushed the US dollar to rise and gold to decline is the rise in the number of Fed members who expect the start of raising interest rates in the next year 2022, from 7 members in the previous meeting to 9 members now.
the Federal Reserve is completely split in half on the issue of raising interest rates in 2022.
Six members voted to raise interest rates to the level of 0.5%, while the remaining three voted to raise it to the level of 0.75%.
The other half of the members voted to keep interest rates at their current levels between 0-0.25%.
All this was within the limits of market expectations, which will now return to monitoring developments and economic data that will determine the Fed's next moves.
Currently, what is preoccupying the markets is the issue of Evergrande and its ability to meet its obligations and pay its outstanding debts, despite the decline in fears, especially after the Federal Reserve confirmed that the great impact of this issue will be within China in particular.
In the midst of this, the price of gold has been moving within the range of technical levels, which can be relied upon at the moment to enter and exit positions.
In the medium term, the price is moving in the side frame between 1831-1750, with a pivotal level at 1782.
In the previous downside wave, the price stopped at the support level of 1850, before rising again with the outbreak of the Evergrande crisis. And testing the resistance level 1782-1778.
On the 4h chart, the price of gold is moving in a bearish channel, and on the 1sa chart, it is moving in an ascending channel.
These levels can be used to enter and exit quick trades, but the 1850-1846 support area is the strongest area to buy with a stop loss below this level.
For sale, the resistance zone between 1778-1782 is the best option.
In the event that these levels are broken or breached, this will open the door for more momentum to get out of the current trading range.
Whatever trading decision you make, don't forget to stop loss and risk management.
Good luck.