Gold continues to consolidate in the range of $1480-1510 per ounce. At the end of last week, bulls broke the line of a 2-months trend down. However, the breakout turned out to be local and the price soon returned to $1495, which is the equilibrium value of October. The volatility declined again, following the traders’ interest in the asset. As we know, the longer the consolidation, the stronger the trend. Its direction will certainly depend on fundamental factors. In case of a bearish scenario, the area of purchases will be $1450-1460, and a short-term movement down to $1400 is also possible. If the bullish rally continues, the next target for buyers will be the psychological mark of $1600.
Market is now focused on the interest rate decision by the US Federal Reserve, which comes out on Wednesday. Traders are pricing in a 95% chance of a third rate cut in 2019. This probability is already included in the price of gold, so if the Fed decides to leave rates unchanged, this could be a trigger for active sales. However, as always, the main issue that worries traders is not even the current meeting, but the prospect of further rate cuts.