No action in Gold

FXStreet (Mumbai) - Gold sees no action, even after the opening bell in the US as investors avoid taking big bets ahead of the FOMC event. The metal trades marginally lower for the day at USD 1147/Oz levels.

Next move - USD 1100/Oz or USD 1200/Oz?

Whether the yellow metal moves roughly USD 50/Oz higher or lower from the current price depends entirely on the tone of the Fed policy statement and on the Fed chairwoman Janet Yellen’s comments at the press conference. An outright hawkish FOMC event could push the metal down to USD 1100/Oz levels. On the other hand, it would take a sharp weakness in the USD index to drive the metal higher to USD 1200/Oz. Such a sharp weakness in the USD necessitates ultra dovish stance from the Fed; something which is not anticipated by the markets at all.

At the moment, the metal could see some revival if the stock markets in the US see serious risk aversion. However, the safe haven metal may not gain if the risk aversion in the stocks is driven by expectations of Fed indicating an early rate hike.

Gold Technical Levels

The immediate support is seen at 1142.6, under which losses could be extended to 1131.9 levels. On the flip side, a rise above 1155, could send prices higher to 1167.4 levels.