Gold has recovered more than $10 as US markets hit 14-month low. Markets eye US Fed decision for further direction.It is currently trading around $1248.
The major three factors that drive gold prices
US dollar Index: neutral. DXY has lost more than 50 pips from high of 97.71.US dollar index’s major resistance is around 97.75 (trend line resistance) and any further bullishness only above that level.It is currently trading around 97.06. (positive for gold).
USD/JPY: Strong. The pair is trading weak and lost more than 50 pips after breaking major support 113.20.It is currently trading around 112.54. The near term support is around 112.20 and any break below targets 111.37. Slightly positive for gold.
US 10 year yield : US 10 year yield has lost more than 2.5% after a minor recovery till 2.92%. It is currently trading around 2.85%.positive for Gold.
US 2 year yield: It has lost more than 4% from high of 2.78% on Dec 13th 2018.The spread between US 10 year and 2 year has decreased sharply to 17bpbs from 30 bpbs. The spread between 5 year and 2- year yield has inverted for the first time since 2007.
Gold technical
Major support $1183
Major resistance - $1243
On the higher side, major resistance is around $1251 and any convincing break above targets $1260/$1265.
The near term support is around $1233 (20-day MA) and any violation below will drag the commodity down till $1225 (89-day EMA)/$1217.
It is good to buy on dips around $1242-43 with SL around $1236 for the TP of $1260.


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