Gold prices dipped lower on Monday morning as investors disregarded the geopolitical uncertainty due to North Korea missile test over Japan. Furthermore, Gold slides lower ahead of the Fed meeting on Wednesday as investors’ expectations that the Federal Reserve will hike rates increased during the previous week.
On Friday, The Commerce department released inflation data – Retail sales fell 0.2% last month, missing expectations of a 0.1% rise. A duo of reports on manufacturing and consumer sentiment followed the weaker-than-expected retail sales data.
Technical outlook
Gold prices hit the support area and currently trade below the $1320 level. Prices have formed Head and shoulder chart pattern with a downside pressure. A break below $1320 level could lead towards $1300-$1310 level and eventually towards $1280 level. There is a gap above that has to be noticed as gaps tend close at some point.
Gold prices were unable to hold above the support line. Gold daily chart has formed a “Rising Wedge Pattern” as current prices have broken the support line, which indicates a bearish momentum. A break below could lead towards $1318-1300 level.
Gold was trading at $1318.5, down 0.53% as of 8:00 GMT.