Gold prices moved higher on Wednesday as the dollar extended losses against the yen, falling to the lowest levels since December 1 amid thought that the Bank of Japan could move to scale back its huge motivation program later this year.
The U.S. dollar index, which measures the greenback’s strength against a tradeweighted basket of six major currencies, framed down to 92.15 from Tuesday’s oneweek high of 92.36.
Demand for the dollar continued to be the base by expectations for further interest rates hikes by the Federal Reserve this year after Friday’s U.S. jobs report did little to modify the viewpoint for monetary tightening.
Gold 4hr chart has formed “Bullish Rectangle chart” pattern. The last few sessions seems consolidated inside the channel. The market is likely to fall on bearish momentum to retest the channel’s support level and turn bullish once again. The downside rally could test all the way through $1315-1310(29195-29070) levels in the upcoming sessions. Resistance holds at $1330(29570) and Support at $1310(29070).
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