OANDA

Gold commentary [27/07/17]

News   •   Jul 27, 2017 12:11 +08

The FOMC came to gold's rescue overnight as the yellow metal unwound what was potentially a profit taking day and rose a healthy 0.90% to close in New York around 1261.00 from a 1250.00 opening. The FOMC's admission that inflation remains "subdued" and that balance sheet unwinding with start "soon" saw the U.S. Dollar red carded and stretchered off the pitch in both the FX and metals markets.

In addition to gold's much higher close, it also tested but held its 100-day moving average at 1249.10 before closing much higher. This is a pleasing technical development for gold bulls out there. The U.S. Senate's latest failure to repeal Obamacare and their impending Russian sanctions vote should also be enough to keep the uncertainty premium in gold percolating nicely in the back ground.

Asian demand has seen gold drift higher by three dollars to 1264.00 this morning as the FOMC fallout continues across the G-10 currency space. Supports lies at 1259.60 initially followed by the 100-day average at 1249.10. Resistance is at 1267.00 intra-day with a daily close above implying a march to the 1281.00 regions is on the cards.