Gold Price Analysis: Gold to Struggle Ahead of Fed Decision

Gold Price Analysis: A pickup in the US bond yields dragged gold lower for the second straight session on Friday. On the first day of a new week, sustained USD selling bias assisted the yellow metal to regain traction. Investors eye US Durable Goods Orders for some impetus ahead of the FOMC policy meeting, FXStreet’s Haresh Menghani briefs.

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“The view that any spike in inflation is likely to be transitory and that the Fed will keep interest rates lower for a longer period extended some support to the dollar-denominated commodity and helped limit any deeper losses, rather assisted to regain some positive traction on the first day of a new trading week. That said, the upside is likely to remain capped as investors might prefer to wait on the sidelines ahead of the latest FOMC monetary policy update, scheduled to be announced on Wednesday.”

“Monday’s release of the US Durable Goods Orders might influence the USD price dynamics and provide some impetus later during the early North American session. Apart from this, the US bond yields and the broader market risk sentiment might also contribute to produce some meaningful opportunities around the gold.”

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“Repeated failures near the $1,800 mark warrant some caution before positioning for any further appreciating move. Hence, it will be prudent to wait for a sustained move beyond the mentioned handle before placing fresh bullish bets. Gold might then accelerate the move towards the $1,815-16 resistance, marking the 50% Fibonacci level of the $1,959-$1,676 downfall.”

“The double-bottom neckline resistance breakpoint, around the $1,765-60 region now seems to protect the immediate downside. This is followed by the 23.6% Fibo. level, around the $1,745-44 area and the $1,730 level, which if broken decisively might negate the positive outlook. The XAU/USD might then turn vulnerable and accelerate the fall towards challenging the $1,700 round-figure mark.”

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