Gold Price Analysis - 16 September 2014

Alp Kocak

The XAU/USD pair closed higher than opening, snapping five consecutive days of losses, as investors started the week by taking some of their recent profit off the table. A recent string of encouraging U.S. economic data has stoked speculations the Federal Reserve may act sooner to hike interest rates. The precious metal has been also experiencing a lack of safe-haven demand, with the situation in eastern Ukraine having stabilized.

Yesterday's price action indicates that investors aren’t interested in going too far out on the risk spectrum ahead of the Federal Reserve's two-day policy meeting which begins today. The central bank will provide new economic projections, and Chair Yellen is scheduled to give a post-meeting press conference. While some feel that good economic data will give Fed the confidence to normalize the monetary policy, others think that the Fed has the luxury to keep policy accommodative as long as inflation remains under control.

XAUUSD Daily 91614

From an intra-day perspective, the key levels to watch will be 1225 and 1240. During today's Asian session the XAU/USD pair is trading between the Tenkan-sen (nine-period moving average, red line) and Kijun-sen (twenty six-day moving average, green line) on the 4-hour time frame and both lines are flat at the moment. If short-side profit taking continues and the market climbs above the 1235 level, it is very likely that we will see the 1240 resistance being tested. I think penetrating that barrier is essential in order to test the next resistance at 1246.80. A drop below 1225 would place control back in the paws of the bears as we head towards the 1213 support level. On its way down, an interim support can be found at 1218.

XAUUSD Week 91614

Alp Kocak
Alp Kocak has been trading Forex since 2003. He writes technical analysis based on Japanese candlesticks and Ichimoku Kinko Hyo.

Did you like what you read? Let us know what you think!

exclamation mark

Please make sure your comments are appropriate and that they do not promote services or products, political parties, campaign material or ballot propositions. Comments that contain abusive, vulgar, offensive, threatening or harassing language, or personal attacks of any kind will be deleted. Comments including inappropriate will also be removed.

0 User comments

exclamation mark

Please make sure your comments are appropriate and that they do not promote services or products, political parties, campaign material or ballot propositions. Comments that contain abusive, vulgar, offensive, threatening or harassing language, or personal attacks of any kind will be deleted. Comments including inappropriate will also be removed.

Read more
Add new comment
This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.