XAU/USD: prices decline ahead of the US Fed meeting
Current trend
Gold prices are near 1770.00 after a noticeable downward correction recorded the day before. Market activity remains subdued as traders await the publication of the minutes of the US Federal Reserve meeting, which as many hope, will indicate a further tightening of the US regulator's rhetoric.
The US Federal Reserve is expected to announce an early completion of the bond purchase program, potentially bringing the next year's interest rate hikes forward. Previously, it was assumed that the regulator will fully complete the quantitative easing program by June 2022, but now it may turn out that the department will have ended it by March. However, skeptics argue that the Chairman of the US Fed, Jerome Powell, began the fight against high inflation too late, and therefore the regulator's plans will be adjusted more than once.
Additional support for the dollar is provided by the statistics on manufacturing inflation released yesterday. In November, the Producer Price Index excluding Food and Energy rose 0.7%, accelerating after rising 0.4% in October.
Support and resistance
Bollinger Bands in D1 chart demonstrate a moderate decrease. The price range is narrowing, pointing at the ambiguous nature of trading in the short term. MACD is declining keeping a weak sell signal (located below the signal line). Stochastic is showing more confident "bearish" dynamics, but is rapidly approaching its lows, indicating growing risks of the instrument being oversold in the ultra-short term.
Resistance levels: 1778.32, 1790.00, 1800.00, 1812.22.
Support levels: 1760.74, 1750.44, 1740.00.
Gold prices are near 1770.00 after a noticeable downward correction recorded the day before. Market activity remains subdued as traders await the publication of the minutes of the US Federal Reserve meeting, which as many hope, will indicate a further tightening of the US regulator's rhetoric.
The US Federal Reserve is expected to announce an early completion of the bond purchase program, potentially bringing the next year's interest rate hikes forward. Previously, it was assumed that the regulator will fully complete the quantitative easing program by June 2022, but now it may turn out that the department will have ended it by March. However, skeptics argue that the Chairman of the US Fed, Jerome Powell, began the fight against high inflation too late, and therefore the regulator's plans will be adjusted more than once.
Additional support for the dollar is provided by the statistics on manufacturing inflation released yesterday. In November, the Producer Price Index excluding Food and Energy rose 0.7%, accelerating after rising 0.4% in October.
Support and resistance
Bollinger Bands in D1 chart demonstrate a moderate decrease. The price range is narrowing, pointing at the ambiguous nature of trading in the short term. MACD is declining keeping a weak sell signal (located below the signal line). Stochastic is showing more confident "bearish" dynamics, but is rapidly approaching its lows, indicating growing risks of the instrument being oversold in the ultra-short term.
Resistance levels: 1778.32, 1790.00, 1800.00, 1812.22.
Support levels: 1760.74, 1750.44, 1740.00.
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