Gold Price Forecast – Gold markets continue to show strength ahead of the Federal Reserve

Gold markets continue to rally significantly during the trading session on Wednesday, breaking above resistance again, perhaps in a bit of a “front running” to the Federal Reserve softening its stance. While an interest rate hike is already expected, the reality is traders will be paying more attention to the statement afterwards, perhaps trying to parse whether or not the Federal Reserve is going to continue to raise interest rates at the same clip that they had previously suggested. If there’s any hesitation, or if they start to talk about being “data dependent”, that will send Gold much higher.

Gold Price Video 20.12.18

Ultimately, I think it comes down to where we close for the session, and if it is above the $1255 level, gold should become more bullish and we should continue to go much higher. Overall, I think that the markets will continue to favor gold overall, because not only do we have the idea of the Federal Reserve stepping away, we also have the possibility of gold being used as a safe haven. However, if the Federal Reserve seems as if it is still on track to continue raising rates three times in 2019, that will send the US dollar much higher as traders are starting to try to get ahead of the announcement. If that’s the case, I suspect gold will fall back underneath and continue to grind along the 50 day EMA. Either way, I would wait on a daily close to make a trading decision as there will be a lot of noise.