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"Gold has been extraordinarily sensitive to perceived changes in monetary policy for many months. The rate rise may finally clear the deck and remove rate-related uncertainty from the bullion market."
- HSBC (based on CNBC)
Pair's Outlook
The Dollar plunged at the expense of gold prices on Wednesday, as the Fed Chair Janet Yellen confirmed the future pace of rate hikes will be gradual. XAU/USD closed above July low around 1,072. On Thursday, however, we are observing a downside correction, which is at risk of being prolonged further. The bears are looking at the lower Bollinger band (1,058) in the short-term, while in the long run depreciation towards the 1,044 mark is possible. On top of that, gold continues to be driven down by two resistances at 1,073/74, namely the 20-day SMA and weekly pivot point.
Traders' Sentiment
A decision of the world's biggest central bank has been unable to move the SWFX market sentiment so far. At the moment the majority of traders are betting on the metal's rally (59%), while the bearish share is minor of just 41%.
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