The yellow metal extended gains at yesterday’s session to $1,108.60 refreshing a weekly high. The metal managed to close above 3-week high after a huge consolidation in a tight range.
Lockhart said that Fed tends to raise interest rates in September, but wait 1-2 meeting and you will not see any action and a decision on the US economy. The policy maker is very supportive of a possible rate hike in September.
Federal Reserve Vice Chairman Stanley Fischer disagrees with the rate hike in September. Inflation is the major concern, however the employment rate is returning to the target level.
The Fed news agency correspondent Hilsenrath thinks that the Fed will be monitoring a decline in inflation expectations based on market expectations.
Fed Vice Chairman said that the United States is close to full employment, low inflation is temporary. Atlanta Fed President reiterated its stance on the September hike.
The world’s largest gold ETF – SPDR Gold Trust is held steady at the level of 667.69 tons.
The metal took advantage of the gap between the Fed members, so gold managed to breach the higher ceiling.
Goldman Sachs: If gold prices rise to $1,117.00 an ounce, the metal is likely to jump to $ 1,150.00 an ounce.
Technical view: For the last 3 weeks, the metal was taking support at $1,077.00 level. Gold closed above $1,085.00 on a weekly basis.
The metal managed to closed above 20Dsma after 34 sessions. The 20Dsma is found at $1,101.00 and multi resistance zone seems at $1,110.00. The yellow metal was trading at $1,103.60 during today’s Asian session, compared to $1104.00 at Monday’s close.
Review: At yesterday’s session, we forecasted developing positive divergence, the trend favours buying with sl $1,087.00. The metal made a low at $1,089.40, changed the direction and made a high at $1,108.60.
Yesterday’s forecast: «The metal was consolidating between $1,077.00 and $1,105.00 for 11 straight sessions with developing positive divergence. If the metal manages to close above $1,106.00, bulls aim at $1,110.00 initially, later at $1,115.00 and $1,118.00″.
Intraday: Support is set at $1,099.00 and $1,095.00. Resistance seems at $1,110.00, $1,1115.00, and $1,120.00. Today’s trend favours buying with sl $1,087.00. Fresh buying advised above $1,110.00 with targets at $1,115.00, $1,117.00, and $1,119.00.
The material has been provided by InstaForex Company – www.instaforex.com