Gold was generally bearish against the US Dollar on Tuesday even though it managed to regain some of the lost positions by Wednesday morning. The pair’s fall during the first part of the day was stopped by a trend-line at 1,310.00 which allowed to re-acquire its position above the 55-hour SMA.
The apparent upside potential until the 1,320.00 area could be realised during the first part of the day; however, an uneventful period of consolidation is as likely prior to the FOMC statement at 1800GMT. This fundamental release is very likely to introduce volatility in the market and even direct the rate’s subsequent movement.
Gains should be capped at 1,324.00, while the 50.0% Fibonacci retracement is expected to provide an unbreakable support.
