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MENAFN- Daily Forex)
During yesterday's trading, gold prices fell to $2744 per ounce and quickly recovered after reacting to the US Federal Reserve announcement. Now, the gold price index is hovering around $2757 per ounce at the time of writing this analysis. So far, spot gold prices are still near their highest levels ever. Obviously, that's amid uncertainty about the impact of US administration policies on the global economy and the future of global central bank policies.
Gold Market Affected by the US Federal Reserve Announcement
According to recent trading and gold trading companies' platforms... Prices continued to be affected as investors reassessed the US Federal Reserve's policy expectations after its largely expected stabilization. Overall, the US central bank sent hawkish signals by removing a paragraph reflecting optimism that US inflation is moving towards the 2% target from its statement, in addition to acknowledging that growth and business conditions are strong. Meanwhile, demand for safe havens slowed as mixed messages from US government officials eased concerns about sweeping tariffs by the Trump administration.
On the other hand, dovish moves from other global central banks limited bullion's decline. The Bank of Canada ended its quantitative tightening, joining the Swedish central bank in cutting interest rates. The European Central Bank is also expected to cut rates this week, while both the Reserve Bank of India and the People's Bank of China have indicated upcoming rate cuts.
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Gold prices will remain bullish for a while, so take advantage of the decline in prices to think about buying, but without risk Stocks Affected by the Federal Reserve Announcement
According to yesterday's trading and through stock trading company platforms... US stock indices declined after the Federal Reserve chose not to cut US interest rates for the first time since it began trying to help the economy through easier interest rates in September. According to trading, the S&P 500 index fell by 0.5% after the widely expected Federal Reserve decision. The Dow Jones Industrial Average fell 137 points, or 0.3%, and the Nasdaq Composite Index fell by 0.5%.
In general, the reaction was also relatively muted in the bond market after the Federal Reserve decision, which may indicate that prices will remain stable for some time after their rapid decline at the end of 2024. Low interest rates will help the economy by making borrowing cheaper for American households and businesses, but the downside is that they may also give inflation more fuel. For his part, Federal Reserve Chairman Jerome Powell said after the decision that the US central bank may cut interest rates if inflation slows further or if the labour market suddenly weakens. But "at the moment, we don't see that, and we see things in a really good place for policy and the economy, and so we feel like we don't need to rush into making any adjustments."
Meanwhile, Wall Street almost always favours low interest rates. According to market experts, we will continue to focus on why the Federal Reserve will not cut anytime soon, namely the strong economy and employment, which bodes well for strong corporate earnings growth.
EURUSD Chart by TradingViewGold Price Technical Analysis and Expectations Today:
According to today's gold analysts' expectations, the general trend for gold bullion prices is still upward, and breaking the $2766 per ounce resistance will motivate the bulls to prepare to move towards the historical psychological peak of $2800 per ounce, which in turn will move the technical indicators towards strong overbought levels, led by the Relative Strength Index. I still prefer the strategy of buying gold from every decline level, but without risk and activating profit-taking and stop-loss orders to ensure the safety of the trading account from any sudden price reversals.
On that time frame, the daily chart will have the closest support levels for gold prices at $2,738, $2,715, and $2,585 per ounce, and from the last level, a break of the upward trend will be confirmed. Furthermore, the price of gold today will be affected by the reaction to the announcement of the US economic growth reading and tomorrow the announcement of the US inflation reading preferred by the US Federal Reserve.
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