Gold prices holding on resistance trend line| fed meeting expectation
11-06-2018 10.30 AM
Gold prices seem to stay susceptible ahead of the upcoming Federal Reserve meeting on Wednesday. It is extensively expected to raise interest rates as it would be the second rate hike this year.
Expectations for higher interest rates be likely to be bearish for gold, which fights to battle with yield-bearing assets when rates rise.
Updates on U.S. inflation, retail sales and industrial production will be revealed this week. But Gold could find some support from safe haven buying accompanied by sensitive trade tensions as markets absorb the outcome from a debatable weekend G7 summit meeting in Canada.
President Donald Trump said Saturday the U.S. wouldn’t sanction the final announcement released at the end of the meeting, what he called Canadian Prime Minister Justin Trudeau's "false statements" at a news conference.
A meeting between Trump and his North Korean counterpart Kim Jong in Singapore on Tuesday will also be a focal pointin the midst ofsensitive geopolitical tensions.
The fresh morning of the week starts with prices showing bullish indication but prices on the previous support become resistance trend line at $1305 which is considered as an important barrier of the market. Once a break above occurs, then the prices will turn bullish extending towards $1315-1325.
As per the technical outlook, the prices have already broken the resistance line wherein “Falling channel pattern” on a daily chart. But meanwhile, the prices have taken some consolidation due to $1305 which is a short-term struggling point that has to be controlled.
Traders await for FOMC statements as fed plans to raise FED interest rate by 1.75% to 2% level on Wednesday night 11.30 pm, which was revealed by a financial news company.