Gold performed well in testing the FOMC “drift” effect, even though to a lesser extent than silver.
The results of the FOMC meeting will be presented on March 22 at 9:00 pm Moscow time.
Research on precious metals price movement ahead of the FOMC meetings showed that the metals tend to increase 24 hours before the Federal Open Market Committee of the U.S. Federal Reserve.
In the current situation of instability and fear precious metals are of most interest due to their increased status as safe-haven assets and a possible slowdown or even pause in rate hikes by the U.S. Fed.
Gold is considered a traditional safe-haven asset. When stock markets fall, cryptocurrencies act unpredictable, and the dollar loses its stability, the yellow metal comes to the fore.
Gold is currently trading slightly above a psychological level of $2,000 per ounce. In the light of recent events, associated with the fall of several banks across the U.S. and Europe, the metal’s continued rise in price is highly likely.
It is interesting that any scenario of the Fed’s actions is favorable for gold now. In case of rate hikes, the pressure on the banking sector will worsen, thereby stimulating demand for gold as a safe-haven asset. In case of a pause in hikes or their decrease, the dollar will begin to weaken, making the yellow metal more accessible for traders and investors.
The entry-exit strategy is similar to silver’s strategy:
Buying gold on March 21 at 9 pm Moscow time.
Closing the deal:
* Take Profit 1 = 2,050; Take Profit 2 = 2,100.
* Or exit the market on March 22 at 8:59 pm Moscow time.
* Or exit the market on March 23 at 4:59 pm Moscow time
Protective Stop Loss order is set below the low of the previous trading day, that is March 20, or below the support level of $1,950.
This content is for informational purposes only and is not intended to be investing advice.
