At Thursday's trading, the price of gold is gradually recovering after a sharp decline on the Fed's decision to soften monetary policy. The regulator lowered the interest rate by 0.25%, but signaled that the bank management has no consensus on the extent and need for further easing of monetary policy.
In our opinion, the initial reaction of the market to the results of the FOMC meeting was influenced by speculative positions. The results of the meeting as a whole is a positive signal for precious metals. Firstly, the regulator lowered the interest rate, which will put pressure on the dollar and the yields of American treasuries. Secondly, the Fed does not exclude further easing of monetary policy, which increases the likelihood of further development of the bullish trend for gold.
Therefore, in the medium term, quotes can be restored to annual highs.
Today, in addition to geopolitical news, the focus of the market will be economic statistics from the United States. The publication of indexes from the Federal Reserve Bank of Philadelphia and data on sales in the secondary housing market are expected.
Trading is still held in the range of 1485.00-1523.00. An attempt by the bears to push through the lower border of the price channel was unsuccessful, therefore, from the current levels we are waiting for the development of an upward movement to the upper border of the range.
Resistance Levels: 1523.00, 1545.00, 1555.00;
Support Levels: 1485.00, 1455.00, 1430.00.
The main scenario is an increase in the direction of the level of 1523.00.
An alternative scenario is the breakdown of support at 1485.00 and the further development of the downward movement.
The market is locally dominated by a moderately positive fundamental background. On the chart there was a rebound from the strong support level of 1485.00. Short-term preference is for longs that are worth looking at 1488.00.