FxWirePro: Gold recovers as market factored fed rate hike, good to buy on dips

• Gold prices has shown a good recovery after hitting low of $1291.50. US fed hiked interest rates by 25 basis point yesterday as expected and outlook on economy is positive. The medium dot plot shows four rate hikes this year. The more hawkish comments from fed has dragged gold prices slightly down initially but downside was limited due to ongoing geo political issues.  US 2 –year bond yield hits highest level since 2008 and 10 year yield jumped above 3%. It is trading steady after hitting of 2.96%. USDJPY declined sharply more than 50 pips from high of 110.84. It is currently trading around 110.06. The yellow metal hits high of $1311 yesterday and is currently trading around $1302.58.
   
• The major three factors to be watched for gold price movement are

1. US Dollar index – weak  (positive for gold)
    
2. USDJPY- weak  (positive for gold)
    
3. US 10 –year yield – 2.96% (0.74% decline for the day (slightly positive for gold)
    

• The yellow metals near term resistance at $1307 (200- day MA) and any convincing close above will take the yellow metal till $1316 (55- day EMA)/ $1324 (50% fibo). 
   
• On the lower side, near term support is around $1289 and any break below will drag the yellow metal down till $1280/$.

It is good to buy on dips around $1295-97 with SL around $1289 for the TP of $1.