Tuesday’s morning session was spent calmly, as the pair was fluctuating between the 23.60% Fibo and the weekly PP. This still movement changed later in the day when a strong hourly plunge allowed for a breakout of the 200-hour SMA circa 1,335.00. Gold has since edged slightly lower; however, it did remain within the bounds of a narrow short-term channel down.
Given that technical indicators are still located in the oversold region, a bullish recovery is still expected to occur in the nearest time. The pair should gain some pips during the following hours; however, the 1,335.00/1,340.00 area is likely to restrict further advance.
In terms of support, the yellow metal should not exceed the weekly S1 at 1,320.00. The market might also be steady prior to FOMC meeting minutes published at 1900GMT.
