It is anticipated that the coming two days will finally provide a directional cue for the market.
- The Gold market witnessed a rally during the trading session on Wednesday as traders keenly awaited the Federal Reserve statement.
- Currently, it seems that the market is locked between the $1950 level acting as substantial support, and the $2000 level serving as significant resistance.
- The 50-Day Exponential Moving Average sits squarely in the middle, underscoring a key ‘holding pattern’ in the gold market. This makes sense as we wait for such important fundamental news.
This holding pattern is anticipated, considering the influential Federal Reserve statement on Wednesday and the European Central Bank’s statement due on Thursday. These pivotal announcements have the potential to induce substantial volatility. Over time, the market seems to be assessing its stance for a more significant move. However, in the short term, the market appears to be oscillating within the defined range, attempting to gauge the momentum for a longer-term move.
Should the market fall below the $1950 region, it could pave the way for a downward move towards the 200-Day EMA, near the $1900 mark. Conversely, if the market reverses and breaches the $2000 level, it could spur a climb towards the $2050 level—a significant barrier previously. Surpassing this hurdle could likely instigate the market to test the $2100 level, an area that has thrice served as a major resistance over the past few years. A break above there would be monumental, to say the least.
It is anticipated that the coming two days will finally provide a directional cue for the market. While there is an underlying assumption of a continued buyer presence, the potential for central banks to unsettle the markets, thereby causing a fall in gold prices, cannot be dismissed. Currently, the market appears poised for continued volatility and choppiness within this narrow range. However, these oscillations are predicted to conclude soon.
Market participants should carefully observe the next impulsive candlestick, as it could provide crucial insights into the future market direction. As central bank statements are released, they are bound to impact gold market dynamics significantly. The current holding pattern may soon give way to a more decisive move, and traders should remain alert to these shifts. This market cannot stand still in this pattern forever, and therefore it is possible that the market will give us a great signal for a longer-term trade.
Ready to trade today’s Gold prediction? Here’s a list of some of the best XAU/USD brokers to check out.