Gold Price Prediction – Gold Consolidates Ahead of Fed

Gold prices were nearly unchanged on Monday, forming a Doji day which is a sign of indecision. Prices initially moved higher as the Euro gained traction but the dollar rebounded during the North American trading session putting downward pressure on the yellow metal. The US-Chinese trade deal might be delayed further which buoyed riskier assets. Brexit now appears to be delayed until the end of March which took some of the geopolitical pressures out of the market. The Fed meets later in the week. All eyes will be on the dot plots. Recall, in December more than 10-members of the FOMC say 2-increases in rate in 2019.

Technical Analysis

Gold prices moved sideways on Monday forming a Doji day which is where the open and close are near the same levels. Prices were unable to pierce through resistance early near the 50-day moving average at 1,304. Short term support is seen near the 10-day moving average at 1,296. Short term momentum has turned negative as the fast stochastic generated a crossover sell signal. The current reading on the fast stochastic is 38 on the lower end of the neutral range but still reflects consolidation. The MACD (moving average convergence divergence) index is printing in the black with an upward sloping trajectory which points to consolidation.

US-China Trade Deal Might be Delayed

This weekend the China morning post reported that the US and China will likely delay a final meeting between Trump and XI until June. Last week it was reported that this meeting was likely to be scheduled for some time in April. While there continues to be positive news and both sides are making inroads, there is little information about securities the US would have over intellectual properties. While an official meeting might be put off, the President and XI are expected to talk informally as the G20 meeting in Japan.