Gold Catches 'Risk-Off' Bid Post BoJ
Gold has caught a strong bid following the decision by the Bank of Japan
to leave its monetary policy unchanged, resultING in markets going
into 'risk'off' mode, with Asian shares tumbling, including the Nikkei
225, down more than 3%.
FOMC, BoJ perfect bullish storm
The
vigorous rise in the yellow metal has sent the price almost $20 higher
from post FOMC lows of $1,238.00 up towards $1,256.00 highs, breaking
the key resistance of $1,250.00 in the process. Gold is presently being
assisted, not just by risk averse conditions, but also by broad-based
USD weakness, following another dovish outcome by the FOMC, which makes a
June rate hike as dubious as it was pre-event. According to the Fed
fund rates, the chances for a June move currently stand at 33%, while
July has the odds at 49%.
Gold key levels
1,255
represents immediate resistance area, as per sequence of intraday highs
printed on April 19th-20th, followed by 1,260 ahead of critical 1,270;
above the latter, expect 1,280 to come into play. On the downside, 1,250
should see buyers re-emerge to defend the level, followed by 1,245
daily pivot point ahead of today's low at 1,240. Note, the next event to
inject volatility in the pair will be today's US GDP Q1, due at 12.30
GMT.