Gold experienced a massive rally between March 8 and March 20, 2023. Price jumped from a low of around $1,810 per ounce on March 8, 2023 to a high of around $2,010 per ounce on March 20, 2023. That's around-11% gain in less than 2 weeks! Banking sector woes, and more precisely resulting drop in yields, played a major role in recent rally as did flight for safety amid increased market uncertainty.
Taking a look at the GOLD chart at the D1 interval, we can see that the price reversed sharply yesterday, pulled back from the $2,000 area and erased all of the daily gains. Prices plunged today as panic on the markets receded. While banking sector woes are not over, actions undertaken by authorities and support from other financial institutions allowed for a recovery move to be launched in risky assets, like equities. Safe havens, on the other hand, started to give back recent gains. GOLD is making a break back below a recently-broken $1,950 price zone. A lot will now depend on FOMC decision on Wednesday, lack of change to a rather hawkish outlook for monetary policy could add more fuel to ongoing pullback on the market. In such a scenario, $1,910 support zone could be the first target for sellers. However, should FOMC lower its terminal rate forecast and Powell hits dovish note during press conference, gold may catch a bid once again.
Source: xStation5
