Gold pared some of its gains ahead of Fed monetary policy. It hit a fresh all-time high of $2589 and is currently trading around $2584.30.
Bullish scenario-
If the fed cuts rates by 25 bpbs with a dovish tone (more rate cuts in future ) or cuts by 50 bpbs . It would take the yellow metal to a new high.
Bearish scenario-
If Fed cuts rates by 25 bpbs with hawkish tones (limited rate cut) would drag the yellow metal to $2540/$2520.
Extreme bearish -
If Fed leaves rates unchanged. The yellow metal would crash drastically to $2450/$2350.
According to the CME Fed watch tool, the probability of a 50 bpbs rate cut in Sep increased to 67% from 14% a week ago.
Technical:
The near–term support is around $2560, a break below the target of $2544/$2535/$2520/$2470. Major bearish continuation only below $2470.The yellow metal faces minor resistance around $2590 and a breach above will take it to the next level of $2622/$2650.
