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Gold: Caution prevails ahead of FOMC, back below USD 1150

FXStreet (Mumbai) - Gold prices on Comex recovered slightly from previous losses in the Asian session, all though remained close to fresh four month lows in calm markets as investors remain bearish due to bets on the Federal Reserve.

Gold cautious ahead of conclusion of Fed meeting

Currently, gold trades flat at 1149.10, having previously posted day’s high at 1152 and day’s low at 1148.80. Gold prices resumed its consolidation phase after yesterday’s volatile US session with up and down swings over 1.0% largely on the back of the unexpected dive of housing starts in February.

Meanwhile, gold prices are expected to remain rangy in cautious trading as traders begin their countdown for the FOMC Statement, with market participants expecting the bank to remove the word "patience" from its forward-guidance stance. The move would say more on the timing of a future rate hike, which is widely expected to come in June.

Gold Technical Levels

The metal has an immediate resistance at 1160 and 1165 levels. Meanwhile, support stands at 1141.60 (March 17 Low) levels below which doors could open for 1132 (Nov 2014 Low) levels.

Nikkei holds close to 15-yr highs before FOMC

The Japanese equities index remains elevated, hovering close to fresh fifteen year peak reached in the previous session as investors braced for the Federal Open Market Committee's monetary policy statement, and above all, whether or not policymakers drop the word "patience" from the statement.
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Yellen’s speech might be mildly USD negative – DB

Alan Ruskin, Macro strategist at Deutsche Bank, comments that in today’s FOMC meeting Yellen might be viewed as mildly USD negative, but any sustained USD move lower would be unlikely.
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