Gold resumes downward move in anticipation of the Fed tapering
Gold fell sharply during the US session as odds are rising that the Fed will soon start tapering. Powell made it clear in today's speech that most of the goals have already been met and the reduction of the QE program may be announced soon. This is obviously fatal news for gold, based on the experience from 2013. Of course, the scale of the sell-off may be smaller, taking into account the much larger balance sheet of the central bank compared to the aforementioned period.
Gold reached the lowest level since August 10 and is following the decline in TNOTE prices (bond yields increase). One can also notice that tech stocks (yellow chart) are also under pressure. The nearest support lies at the 78.6 retracement, but the key support zone can be found around $ 1690-1700 area, where the August and March are located. Previously, the price bounced three times off this level and therefore this zone will be carefully watched by traders. Source: xStation5
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