Gold Slides Ahead FOMC Decisions

Gold is falling on Wednesday, before the decision of the Federal Reserve. Recently it bottomed at $1763m the lowest since December 3 and then rebounded toward $1770. Price is moving sideways with a bearish bias.

The US November retail sales report came in below expectations and boosted gold for a few minutes. After reaching $1774, it turned to the downside amid a stronger US dollar during the American session.

The risk aversion environment kept US yields under control and offered some support to gold. What the Fed decides and what Powell says will have a large impact on the Treasury market, hence in gold prices. The statement will be released at 19:00 GMT, including the projections of FOMC members.

Gold had been moving sideways since December and is has established to critical levels. On the upside is the area around $1790/95, a horizontal line, and also near the 20 and 200-day moving averages. A firm break above and a confirmation should clear the way to more gains above $1800.

Volatility and exaggerated moves are likely during the FOMC announcement and later during Powell’s press conference.