Gold prices continue to benefit from rising risk aversion and a weaker U.S. dollar, pushing into key resistance levels above $1,300 an ounce.
Comex December gold futures last traded at $1,305.30 an ounce, up 1.32% on the day.
Gold’s rally comes on the same day that the Federal Reserve wraps up its monetary-policy meeting. Analysts are not expecting to see any major shift in policy. Tuesday a CNBC poll of economists showed that 100% were not expecting any move in interest rates today. However, the central bank is expected to raise interest rates by 25 basis points in December.
Investors have been keeping a close key on the $1,300 level because it represented key support in this year’s bull market. According to an old market axiom, once chart support fails, this level turns into nearby resistance. However although prices have regained some of their lost footing, analysts say that prices have to push a little bit higher to gain solid technical momentum.
Analysts at iiTrader said that they see major resistance at $1,319 an ounce, which represents the 100-day moving average.
“The bulls must achieve a close above here in order to regain control,” the analysts said in a note to clients.
The brokerage firm added that gold is befitting from a weaker U.S. dollar, which has fallen to a three-week low, down almost 2% from its eight-month high seen last week.
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