Spot Gold maintains negative tone as dollar is firmer on expectation that the Fed may raise interest rates in June. Gold is sensitive to the US rate changes and is eyeing comments from Fed after two day policy meeting ends today, for more clues about possible action in June.
The price is holding near three-week low for the second day, as 200SMA offered solid support at $1252 and so far contained bear-leg from $1295 (17 Apr high).
Gold price is expected to remain within narrow range until release of FOMC statement which is expected to give fresh direction signals.
Hawkish tone from Fed would put gold price under fresh pressure and break below 200SMA would open next layers of supports at $1247/46 (rising 55SMA / 50% retracement of $1197/$1295) and $1241 (bull-trendline connecting lows at $1122/97).
Stronger bearish acceleration may extend towards $1234 (Fibo 61.8% of $1197/$1294 upleg).
Conversely, softer tone from Fed that may signal June rate hike on hold, would boost the yellow metal’s price for retest of pivotal barriers at $1267/$1270 (daily Kijun-sen / Tenkan-sen lines) respectively and shift near-term focus higher on break.
Res: 1257, 1260, 1267, 1270
Sup: 1252, 1247, 1246, 1241
