Gold Holds Near-Term Trading Range ahead of Fed Minutes
Gold
once again retreated from $1280 level and dropped back to $1270 level,
holding its near-term trading pattern within a narrow range.
Gold bulls remain reluctant in lifting the precious metal beyond its
recent trading range and avoided big bets ahead of the Fed minutes that
could provide some hints over the timing of next Fed rate-hike decision.
The minutes from April FOMC meeting are likely to reinforce that the
central bank remains on track to announce at least two rate hike during
2016.
A stronger US Dollar also seems to contribute towards today's weakness witnessed in the precious metal.
On Tuesday, the yellow metal shrugged off upbeat US CPI print for April
and found support from sell-off in US equity markets. However, hawkish
comments from Federal Reserve officials restricted further up-move for
the metal.
At the time of writing, the yellow metal was trading lower by 0.5% at
$1272, still holding above 20-day SMA. Today's FOMC meeting minutes
would be the next big fundamental trigger that would assist the precious
metal to break-out of the recent trading range.
Technical levels to watch
On the immediate downside, bulls would look to defend 20-day SMA support
near $1267 region, below which the metal could immediately drop below
$1260 to $1258 support region.
Meanwhile on the upside, $1278-80 remains key resistance area to
conquer. On a decisive break through $1280 resistance, the yellow metal
could immediately aim $1288-90 resistance, which if cleared has the
potential to continue boosting the precious metal towards its next major
resistance near $1300 handle.
