Ichimoku Analysis (4-Hour chart)
Tenken-Sen- $1663.69
Kijun-Sen- $1646.12
Gold pared some of its gains as the US dollar recovered. The European central bank has raised rates once again today by 75 bpbs, the highest level since 2009. It also changed the terms of cheap loans given to banks. The yellow metal hits an intraday low of $1654 and is currently trading around $1662.
US GDP grew at an annual rate of 2.6% in Q3 compared to a forecast of 2.3%.
The US 10-year yield declined more than 8% after hitting a multi-year high of 4.33%. The US 10 and 2-year spread narrowed to -40 basis points from -57 bpbs.
According to the CME Fed watch tool, the probability of a 75 bpbs rate hike in Nov dropped to 88.5% from 98.4% a week ago.
Factors to watch for gold price action-
Global stock market- Bullish (Negative for gold)
US dollar index – Bearish (Positive for gold)
US10-year bond yield- Bearish (Positive for gold)
Technical:
The near–term support is around $1654, a close below targets of $1638/$1630/1620. The yellow metal faces minor resistance around $1675, the breach above will take it to the next level of $1685/ $1700/$1720/$1740/1760/$1800. Minor bullish continuation only if it breaks $1740.
It is good to buy on dips around $1650-51 with SL around $1637 for TP of $1740.
