Gold gains ground, investors eye Fed meeting

Gold has posted slight gains in the Tuesday session. In North American trade, the spot price for one ounce of gold is $1201.31, up 0.20% on the day. On the release front, CB Consumer Confidence, jumped to 138.4, crushing the estimate of 132.2 points. On Wednesday, the spotlight will be on the Federal Reserve, which is likely to raise interest rates to a range between 2.00% and 2.25%.

The Federal Reserve is widely expected to raise rates by a quarter-point on Wednesday, with the CME Group putting the odds of a hike at 94%. Although the markets have priced in the move, traders could still see some movement from gold. Investors will be keeping as close eye on the Fed rate statement, and if policymakers remain upbeat about the economy, gold prices could lose ground.

The U.S and China fired more trade salvos at each other this week. On Monday, the U.S imposed tariffs on some $200 billion worth of Chinese goods, while China responded with tariffs of $60 billion on U.S products. There may be more headwinds ahead, as China sharply attacked the U.S, saying it had plunged “a knife to China’s neck” with the new tariffs. The Chinese have canceled trade talks with the Trump administration, and no new talks are likely to be held until the mood improves between the world’s two largest economies. Previous rounds of tariffs between the two economic giants have boosted the U.S dollar, but so far, investors have reacted calmly and have not snapped up the U.S dollar at the expense of other currencies.

$100 per barrel oil ??

Euro bounces as Italy targets lower deficit ratio

If in doubt, look to the Fed for direction

 

XAU/USD Fundamentals

Tuesday (September 25)

  • 9:00 US HPI. Estimate 0.2%. Actual 0.2%
  • 9:00 US S&P/CS Composite-20 HPI. Estimate 6.2%. Actual 5.9% 
  • 10:00 US Consumer Confidence. Estimate 132.2. Actual 138.8
  • 10:00 US Richmond Manufacturing Index. Estimate 22. Actual 29

Wednesday (September 26)

  • 10:00 US New Home Sales. Estimate 630K
  • 10:30 US Crude Oil Inventories
  • 14:00 US FOMC Economic Projections
  • 14:00 US FOMC Statement
  • 14:00 US Federal Funds Rate. Estimate <2.25%
  • 14:30 FOMC Press Conference

*All release times are DST

*Key events are in bold

 

XAU/USD for Tuesday, September 25, 2018

XAU/USD September 25 at 11:50 DST

Open: 1198.94 High: 1203.35 Low: 1197.20 Close: 1201.31

 

XAU/USD Technical

S3 S2 S1 R1 R2 R3
1115 1146 1170 1204 1220 1236

XAU/USD was flat for most of the Asian session. The pair has posted slight gains in the European and North American sessions

  • 1170 is providing support
  • 1204 is a weak resistance line
  • Current range: 1170 to 1204

Further levels in both directions:

  • Below: 1170, 1146 and 1115
  • Above: 1204, 1220, 1236 and 1261

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.