Gold Price Forecast: XAUUSD bears must beware of the buy-everything-rally – TDS.

Gold is in wait-and-see mode ahead of the Federal Reserve policy announcement. Strategists at TD Securities expect the yellow metal to rise if the Fed delivers the expected 50 bps rate hike before resuming its downmove.

Highly-anticipated FOMC day could translate into a whipsaw for many gold bears.“It’s FOMC day, and sentiment across global markets is pervasively negative with the Fed set to embark on an aggressive quantitative tightening path and to hike rates by 50bp.”

“The Fed’s move has been well telegraphed, and global market participants are well-positioned for it. In this context, we could potentially expect a ‘buy-everything-rally’ if the Fed hits the mark relative to expectations, as consensus positioning across global markets is flushed out amid pervasively negative sentiment. This would suggest a bullish knee-jerk reaction in gold – but make no mistake, it would necessarily be caused by a dovish Fed.” 

“It is also worth noting that consensus positioning in the yellow metal remains to the long-side, pointing to some complacent length amid the war in Ukraine, which would limit the implications on gold.” 

“Ultimately, the highly-anticipated FOMC day could translate into a whipsaw for many gold bears, before prices resume their downward trajectory.”

EUR/USD retreats from session tops, holds above 1.0500 ahead of Fed.EUR/USD has lost its traction after having advanced to a fresh daily high above 1.0550. The dollar holds its ground after ISM Services PMI data showed that input prices in the service sector rose at a stronger pace than expected in April. Investors wait for the Fed to announce its policy decisions.


GBP/USD drops below 1.2500 on renewed dollar strength.GBP/USD has declined below 1.2500 in the early American session on Wednesday as the dollar preserves its strength and weighs on the pair ahead of the all-important Fed event. The ISM Services PMI report showed that input prices rose sharply in April.


Gold on the defensive below $1,870 ahead of key risk events.Gold is struggling to make a decisive move in either direction on Wednesday and fluctuating in a tight range below $1,870. The benchmark 10-year US Treasury bond yield holds near 3% ahead of the Fed rate decision, limiting XAU/USD’s upside.

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