Article by: ETO Markets
The US Federal Reserve's dovish stance, which supported rate reduction next year after holding interest rates steady between the 5.25% and 5.50% target range, will continue to support the price of gold. US dollar is still holding onto its prior rebound, but the US Treasury bond yields are still low, which is supporting the US dollar and limiting the decline in the price of gold.
Even though the price of gold fell on Friday from over eight-day highs of $… to below, the upward path of least resistance is still present. As long as the price is able to sustain the 20-DMA at $… and the Relative Strength Index above the midline, bullish traders will continue to benefit from the daily technical setup for the price of gold.
The 50-DMA at $… could be the target of a new slump if the daily closing drops below the latter. For gold sellers, the $… barrier might be a difficult nut to crack. Conversely, a return to the $… psychological barrier in the gold price is contingent upon acceptance above the $… area.
