According to experts, this week is a critical week for both the US dollar and precious metals. So, what levels can be seen? Gold analyst Ross J. Burland discussed the possibilities by laying out several gold charts. cryptocoin.com We are giving the details as…
Developments that may affect the price of gold
This week, the Fed’s rate decision, the Federal Open Market Committee’s statement and the Fed chairman’s press conference are expected to be effective. With four rate hikes already priced in the markets, the focus on the Fed’s balance sheet at Wednesday’s meeting could see a shift in the pricing of the Fed’s rate. In this case, gold’s long position is expected to increase, which is supported, albeit modestly, by the decline in the US dollar.
That said, traders will need to keep a close eye on the US Gross Domestic Product and particularly the fourth-quarter Employment Cost Index on Friday. In other words, investors will want to see how inflationary effects enter the labor market.
What do the graphs indicate?
Pointing to the W formation in the graph of 10-year treasury bonds, the analyst emphasizes that the dollar has also returned to a horizontal movement. On the other hand, according to Burland, who drew attention to the gold chart, the gold price converges below $ 1,830 with the gold chart last week. After the 50 percent average reversal on the chart, the price entered critical resistance rather than revisit the trendline support, which could be significant for the path to the psychological $1,850 for this week’s open.
While some slowdown in price correction and consolidation at this week’s critical Fed meeting may be smooth, if support continues, a break of $1,850 could see the bulls move towards the last major level at $1,870. On the other hand, he argues that in order to reach $1,900, a price action like the one in the chart below should be seen:
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