The spot price of gold continues to remain basically flat as gold trades in a tight range this week ahead of today’s conclusion of the Federal Reserve two day meeting.
Liquid gold being poured into a cast to make a bullion bar
As we approach the Fed meeting statement traders are likely to find resistance at $1,362.20 level and support at the $1,329.60 level.
Equity traders can gain gold exposure through the SPDR Gold Shares Trust (GLD, quote) ETF. The ETF physically holds gold. Gold held in the ETF is sold only on as-needed basis for expenses and redemption and only buys gold when in flows require the ETF to increase holdings to match.
At 2:00 p.m. EDT market participants will receive both the Fed decision on rate along with the Fed statement. Expectations are for the Federal Reserve to leave rates unchanged and maintain its $85 billion per month asset buying stimulus program.
With price action touching the 150 day moving average and then rolling over appears market participants are pricing in current sentiment that Fed will not being to taper until next year. Gold has followed and tracked closely to Fed and I don’t see this changing anytime soon. With gold pricing a decision not to taper if we somehow we get a huge taper surprise look for gold to react forcefully…otherwise look for more of the same…