Gold prices rose on Tuesday after reaching a three-week low in yesterday's session. The increase came as the dollar weakened, making gold more affordable for other currency holders. Investors are awaiting key U.S. inflation data and central bank meetings for clues on interest rates policy. The Federal Reserve's two-day monetary policy meeting will conclude on Wednesday, and traders expect rates to remain unchanged while focusing more on the subsequent press release. Lower interest rates typically support gold prices since it creates minor loses for the greenback.
‘ This week the events on the economic calendar including US inflation data, producers price index and the meeting of the Fed is what will be the major driver of the majority of instruments traded against the Dollar, including gold. ’ said Antreas Themistokleous, an analyst at Exness.
On the technical point of view the price is currently testing the support area of the 61.8% of the daily Fibonacci retracement level as well as the 50 day moving average. The Stochastic oscillator is in the extreme oversold levels while the 50 day moving average is trading above the 100 day moving average giving mixed sentiment as to the short term direction of the trend.
If the price continues moving to the downside then the first area of possible support might be found around the $1,950 which consists of the 100 day moving average and the lower band of the Bollinger bands, though it seems rather unlikely to get pushed so far down at least for this week unless the economic data give a fairly bearish image for the Dollar.
‘ This week the events on the economic calendar including US inflation data, producers price index and the meeting of the Fed is what will be the major driver of the majority of instruments traded against the Dollar, including gold. ’ said Antreas Themistokleous, an analyst at Exness.
On the technical point of view the price is currently testing the support area of the 61.8% of the daily Fibonacci retracement level as well as the 50 day moving average. The Stochastic oscillator is in the extreme oversold levels while the 50 day moving average is trading above the 100 day moving average giving mixed sentiment as to the short term direction of the trend.
If the price continues moving to the downside then the first area of possible support might be found around the $1,950 which consists of the 100 day moving average and the lower band of the Bollinger bands, though it seems rather unlikely to get pushed so far down at least for this week unless the economic data give a fairly bearish image for the Dollar.