Gold bounces above $1,070 after a short-lived drop on Fed rate raise

By FXStreet FXStreet (Córdoba) – Gold prices settled higher after the Fed even though no without volatility. Spot gold reacted negatively to Fed decision but quickly bounced. The yellow metal recovered above the $1,070.00 an troy ounce mark, erasing all of its weekly losses.

The Federal Reserve voted unanimously to raise the target range for federal funds to 0.25%-0.50% as widely expected and said only gradual increases are likely. The Fed dot plot showed member projections hasn’t changed since September, with the federal funds rate target at the end of 2016 seen at 1.375% while in the longer-run rates are seen steady at 3.50%.

Gold technical view

“The long term bearish outlook remains in place, as in the daily chart, the price’s recovery stalled short from a daily descendant trend line, now offering resistance for this Friday around 1,078.60. In the same chart, the price is a few cents above a horizontal 20 SMA, while the Momentum indicator aims slightly higher in neutral territory, and the RSI aims north, but remains below its 50 mark”, said Valeria Bednarik, chief analyst at FXStreet. “In the shorter term and according to the 4 hours chart, the recovery has lost momentum, given that the technical indicators are …read more

Source:: FX Street