On Thursday (December 8), the international gold price rose slightly, but the market had mixed views on the Fed’s policy outlook, waiting for the Fed’s policy meeting next week to give new hints on the prospect of raising interest rates. The price of gold is not bullish in the short term, or it may step back to $1772.
At 15:01 Beijing time, spot gold rose 0.02% to $1,786.28 an ounce; the main COMEX gold futures contract rose 0.01% to $1,798.2 an ounce; the U.S. dollar index fell 0.05% to 105.153.
Ilya Spivak, global head of macro at Tastytrade, said: “After an overnight rally, we see a correction in the price of gold. Before the Fed meeting, it may be difficult for gold to start a directional move in any way. If the Fed’s results are in line with expectations, the market will be relieved.” tone, because it’s not worse than expected, the dollar could weaken, which would give gold a little boost.”
Most investors expect the Fed to trim its rate hikes to 50 basis points at its final policy meeting in 2022 this month. The U.S. consumer price index (CPI) for November will be released before the Fed announces an interest rate hike.
But markets were divided on the Fed’s policy outlook. Non-farm payrolls data and strong service sector demand showed the resilience of the U.S. economy, but investors were ambivalent as the Federal Reserve raised interest rates and raised expectations of a recession.
Gold is likely to trade in a range of $1,765-$1,795 ahead of the FOMC meeting, said Christopher Wong, currency strategist at OCBC Bank. He added that the key focus remains how hawkish the Fed’s rhetoric can be.
On the daily chart, the price of gold is still in a correction ((C)) wave trend from $1,810, and may fall back to the 61.8% target of $1,772 in the short term. The ((C)) wave is a sub-wave of the adjustment II wave that started at $1787.