FxWirePro: Gold recovers sharply on Fed move, good to buy on dips

Ichimoku Analysis (Daily chart)

Tenken-Sen- $1561

Kijun-Sen- $1577

Gold has shown a massive recovery of more than $70 yesterday after Fed's QE. The central bank is to buy unlimited quantity bonds and it will lend against students and credit card loans. The yellow metal has formed a double bottom at $1454 and jumped till $1583. It is currently trading around $1573. DXY has shown a decline of more than 100 pips from a high of 102.99.

The total number of people infected due to coronavirus increased to 336000 and the death toll rose to 14643. US 10-year yield has lost more than 40% from minor top 1.276%, the spread between US 10-year and 2-year has narrowed to 50 bps from 70 bps.

Technically, near term support is around $1540 and any violation below will drag the gold down till $1500/$1450.

On the higher side, immediate resistance is around $1585 and indicative break above will take the gold till $1608/$1625.

It is good to buy on dips around $1515-20 with SL around $1505 for the TP of $1430.