The trend in gold prices continued on Wednesday in the wake of the Fed decision to keep rates unchanged. Gold prices rallied to new fresh all-time highs as traders continued to buy the yellow metal. The post-meeting statement from Fed Chair Jerome Powell labeled the current state of growth as better than it was at the trough but still not up to par.
Technical Analysis
Trade gold with FXTM
Gold prices continued to rally to fresh all-time highs as the dollar continued to sink. Prices rose by 0.65% as the trend in gold prices continued to accelerate. Support is seen near the prior highs at 1,921 and then the 10-day moving average near 1,879. Medium-term momentum has turned positive and continues to accelerate higher as the MACD (moving average convergence divergence) histogram is printing in the black with an upward sloping trajectory points to higher prices. Short-term momentum has turned negative as the fast stochastic generated a crossover sell signal. The fast-stochastic is printing a reading of 93 above the overbought trigger level of 80, which could foreshadow a correction. This decline means that the acceleration in prices is slowing. The RSI also surged higher reflecting accelerating positive momentum and is printing a reading of 88, above the overbought trigger level of 70 which could foreshadow a correction.
The Fed Kept Rates Unchanged as Expected
The Federal Reserve kept interest rates unchanged which were widely expected. Along with keeping rates low, the Fed expressed its commitment to maintaining its bond purchases and the array of lending and liquidity programs. The post-meeting statement labeled the current state of growth as better than it was at the trough but still not up to par.
