Author: Mr. Amar – Technical Analysts

After declining more than 100pips yesterday, XAU/USD bounced back towards the yearly high, and now consistently lurking on the weekly resistance at $1842. Gold stays firmer around intraday high as bulls brace for yearly resistance break. Mixed clues ahead of Wednesday’s Federal Open Market Committee (FOMC) meeting join grey concerns over Russia-Ukraine to underpin the yellow metal’s safe-haven demand.

U.S. shares ended on an upward note after a volatile session on Monday. The steep sell-off later in the session, and the ensuing bargain hunting, pushed the indexes into positive territory. Benchmark U.S. 10-year Treasury yields tumbled to a one-week low on Monday. Investors’ focus is now on the Fed policy decision, due to be handed down on Wednesday after a two-day meeting. It is widely expected that the U.S. central bank will indicate that it plans to hike interest rates by 25 basis points (bp) in March 2022.

For the retail traders, analysts have ideas that the next target for bulls is likely the November high at $1877. This price shows the highest resistance level that has not been tested before and the price made a significant dovish movement. Prices may require a bit more consolidation before the next big push is higher. Alternatively, a move lower would aim for a quick show of support from the former resistance level. As the month is about to come to an end, trading strategies need to be precise carefully before the market mover makes any decision in response to FOMC and PCE data release.