Morning Gold: Gold Awaiting FOMC Results

USD Gold

In early U.S. trading, Tuesday, Comex gold futures prices decreased, stressed on chart-related selling and week-long liquidation before of an important U.S. central bank meeting that starts Tuesday and ends Wednesday. Spot gold was last quoted down $9.30 at $1,376.00. Comex August gold last traded down $7.90 at $1,375.20 an ounce.

Asian and European stock markets were varied in slower dealings overnight as the market place eagerly expects the outcomes of the meeting of the U.S. Federal Reserve’s Open Market Committee (FOMC) that starts Tuesday morning and ends Wednesday afternoon. Ben Bernanke, Fed Chairman will as well hold a press conference right after the FOMC meeting. Investors and Traders will be waiting for additional information from the Fed, when and by what number it will begin to cut down its quantitative easing programs that have been in effect for some years.

In additional news on Tuesday, the Euro currency got some support from an improved German ZEW consumer confidence report for June. The report also experienced respondents reckon that German economic activity would provide a boost as the year develops. The Japanese stock market was a little lower in a slower trading Tuesday. The world is heading their eyes towards Japan’s Nikkei stock index, assuming it might be a primary indicator of what is up-coming for the other leading world stock markets.

On Tuesday, the U.S. dollar index lowered and might be heading towards a four-month low. The USD bears have the near-term technical advantage, which is a core bullish reason for the precious metals markets.

The U.S. economic data that will be released Tuesday contains Johnson Redbook retail sales reports, the weekly Goldman Sachs, new residential construction, the consumer price index, and actual earnings.

The London past P.M. fixing of $1,384.75 and A.M. gold fixing is $1,378.50.

Technically speaking, on the daily bar chart the past few sessions August gold has seen a “collapse in volatility” in price action, which indicates a higher price action is approaching. Probably Wednesday afternoon the FOMC results will be the facilitator for a higher price action. Prices are in an 8-month-old downtrend on the daily bar chart. Gold bears have the general near-term technical advantage. The Bears’ next near-term downside breakout price objective is closing prices under solid technical support at last week’s low of $1,364.50. The gold bulls’ next upside near-term price breakout objective is to create a close above solid technical resistance at the June high of $1,423.30. First resistance is sighted at the overnight high of $1,385.40 and then at last week’s high of $1,394.40, as for the first support is sighted at last week’s low of $1,364.50 and then at $1,350.00.