Federal Reserve Decision Day
Kitco Commentaries | Opinions, Ideas and Markets Talk
Featuring views and opinions written by market professionals, not staff journalists.
Yesterday’s close: Settled at 1311.9
Fundamentals: The big day has arrived; the FOMC concludes their two-day policy meeting at 1:00 pm CT with a decision and new Fed Chair Powell will hold his first post-decision press conference at 1:30 pm CT. The Dollar has chopped around this week on little news as traders speculate the potential message from the Federal Reserve. As we discussed in our Tradable Events this Week, we do not believe that they have the fire power to ramp up their dot plot to show a median of four rate-hikes this year. While December and January gave positive developments on both CPI and wages, February essentially back-tracked. Furthermore, consumer spending has been dismal this year and could become a real concern. We have been unequivocally long-term bullish Gold and long-term bearish the Dollar, we continue to hold this opinion strongly.
Technicals: As rough the ride has been over the last week and a half and essentially since late February, Gold has also been extremely constructive. Today’s price action again recovered from major three-star support and the metal is developing something between a bullish triangle and bullish wedge. The questionable part of this development is the drop to 1303.6. While this was still constructive from a pure numbers perspective and began occurring at 5:00 am CT, it does negate the wedge/triangle if not cut off. Considering all of this we maintain that the $1300 area that now closely aligns with the 200-day moving average at 1298.7 is an area of tremendous long-term value.
Resistance: 1318.3-1321.8**, 1329.8-1330.5**, 1341.2-1342.9**, 1350.2-1351.3**, 1367.8-1370***
Support: 1303.6-1308***, 1298.7****, 1291.5**