Gold falls to three-month low as Fed signals more rate hikes

Gold fell to the lowest in almost three months on Thursday, after the Fed kept interest rates unchanged, as widely expected, but signaled more rate hikes towards the end of the year.

The central bank keeps focus on inflation, which still slows below expectations and will probably require more policy tightening in coming months, but stronger than expected performance of the US economy leave space for further rise in borrowing cost.

Hawkish signals from the Fed lifted dollar, making bullion less attractive for investors that increased pressure on gold price.

Fresh weakness broke through strong support provided by 100DMA ($1942) which contained a number of attacks in past weeks, adding to significance of support, also reinforced by the base of rising daily cloud.

Close below $1942 pivot to confirm fresh bearish signal and expose targets at $1909/$1900 (Fibo 61.8% of $1804/$2080 / psychological).

Bearish daily studies add to negative near-term outlook.

Broken $1942 pivot now acts as strong resistance, which should keep the upside protected to maintain fresh bearish bias.

Res: 1939; 1942; 1951; 1970
Sup: 1918; 1909; 1900; 1871