On Wednesday, the price of gold was declining to two-week lows when, following the Fed's rate decision, the Monetary Policy Statement was released. The USD strengthened significantly after the Regulator stated a possibility of a December rate hike.
Current interest rates were kept at the level of 0.25%. Economic uncertainty does not allow the regulator to start tightening its monetary policy. As for low inflation, it is seen as the result of a significant decline in commodity prices.
Early in the session today, the price of gold has started strengthening within an upward correction, which may develop amid the publication of the US GDP statistics for the third quarter.
Support and resistance
Bollinger Band indicator on the daily chart is turning horizontally, while the price range is trying to fix within the current borders. MACD is declining and keeping a sell signal. Stochastic is near the border of the oversold zone and trying to turn up.
It is recommended to wait for clearer trading signals.
Support levels: 1156.40, 1152.15 (28 October low), 1148.43, 1141.60, 1136.37 (8 October low), 1127.80.
Resistance levels: 1162.56, 1170.00, 1174.70, 1179.13, 1182.74 (28 October high), 1186.50, 1191.21 (15 October high), 1194.20.
When the price breaks out and consolidates above the level of 1167.60, long positions can be opened with targets at 1176.80, 1187.00 and stop-loss at 1165.00. Validity – 1-3 days.
Short positions can be opened after the breakdown of the level of 1156.50 with the target at 1147.30 and stop-loss at 1158.00. Validity – 1-3 days.