Gold Elliott wave analysis: price remains sideways ahead of FOMC

Gold has remained in a sideways move just around the 1500 handle. The FOMC is expected to bring some volatility. Where will XAUUSD breakout?

September 18, 2019 | AtoZ Markets – The yellow metal is short of the right trigger thus, has remained quiet since Monday. At the start of this week, Gold pushed from 1486 to 1512 before dropping to 1493 on Tuesday. Ever since, the price has been quietly trading around 1500 oscillating between 1507 and 1497. The near-term direction is still bearish with the top at 1557. However, the long term trend is bullish and is expected to continue once the current bearish correction ends. The bearish correction might drop further to 1450-1400. However, the price might revisit 1525 intraday resistance before declining further. The outcome of the FOMC today will be a great influence.

It seems that the geopolitical tension could get worse with the talk of the US going into a trade battle with the EU after the last ECB meeting. However, before playing this card, the US government might want to see how the market responds to today’s FOMC policies. The Fed is expected to cut the lending rate by 0.25%. The Fed’s outlook into the last quarter of the year will play a major role in how the market reacts today. The US-China trade talk is still on hold. There are no traces that an agreement will be reached. In the midsts of all these uncertainties, Gold could resume the long term bullish trend. However, we need to know if the current bearish correction is over.

Gold analysis: important price levels

Resistance Levels: 1512, 1523 and 1557 are the major barriers before the 1600 handle. If these levels are breached upside, the next target will be the 1600 handle

Support Levels: Before the 1400 handle, 1485 and 1451 are the critical support levels. Price is currently in a sideways range between 1512 and 1493.

Gold Elliott wave analysis

In the last update, we expected another hit of the 1520-1540 price zone. The chart below was used.

There has been a little change but the price has not proceded to any of the minor extreme levels. The new chart below shows a 48-hours long triangle pattern.

If the Gold price breaks upside, we should expect some resistance at the 1520-1540 zone. if the zone is breached toward 1557, the bullish trend should continue toward 1600. However, if the price breaks below 1480-1490 support zone, we should expect further decline to 1451 and toward 1400.

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