Today (Wednesday) the FOMC rate decision will be announced followed by a press conference at 2 PM EDT. If there is an economic event that can move Gold, this would be it.
Barring any Dollar bullish surprises, gold is showing clear bullish momentum going into the event but as I regularly remind our followers, DO NOT CHASE.In this video I review a recent swing trade idea that we shared for the gold CFD (XAUUSD) which neared its first target in less than a day. This idea required a LOT of waiting for criteria which offered reward/risk that makes sense and it begins with knowing your price structure and levels, fundamentals will NOT provide much value for short term timing.
Technically, gold is strong and has been for months with a clear demonstration of higher lows and higher highs. Recent price action has been tricky because it has been gyrating in a 100 or so point range (1760 to 1650 area). This can be a painful hold IF you succumb to all the hype that always pushes unreasonable targets and conspiracy theories when gold is on its highs.
The trend is bullish, but in order to time effectively, probability of location comes into play. For us that was the 1650 area range low. Price recently touched 1670 and that was the first piece of the puzzle for our long idea. The second piece was the setup where we can measure reward/risk from.Once that fit our criteria, THAT is when we can justify a new position.
Keep in mind we recently had a similar situation (May 24th) that we let go and it appeared to run without us, but missing moves doesn’t cost anything.IF Gold can maintain its current momentum and stay above 1700, it is likely to test the 1750 area over the next few days and possibly break into the low 1800s in the following week. Current prices (1715) is not a place to chase, either wait for a better price or step aside and wait for a better opportunity.