Gold price falls to the lowest since early Feb, as markets expect more hawkish stance from Fed

Gold fell sharply on Wednesday (down 3.4% until early US session) signaling continuation of the downtrend from $5419 (Mar 2 high) after bears paused for two consecutive days (the action was shaped in two tight daily Doji candles), consolidating above significant supports at $5000 zone (psychological / daily cloud top).

Fresh acceleration through $5000 pivot surged through daily cloud (spanned between $5000 and $4870) and hit $4834 (the lowest since Feb 2) weakening near-term structure and shifting focus to the downside.

Strengthening negative momentum on daily chart, break below daily cloud and diverging Tenkan/Kijun-sen after formation of bear cross, contribute to negative near-term technical picture.

Gold was deflated by growing expectations that the Fed policymakers may take more hawkish stance on announcement of policy decision, as FOMC two-day policy meeting ends today.

Market expectations were based on fears of fresh rise of inflation, as war in the Middle East escalates, lifting oil prices and threatening of stronger negative impact on already fragile US economy.

Daily studies favor further easing, though the action might be interrupted by consolidation as conditions are oversold.

Close below $5000 is seen as minimum requirement to keep bearish bias, with stronger negative signals expected on close below $4910 (50% retracement of $4402/$5419) and daily cloud base ($4870).

Res: 4967; 5000; 5044; 5070
Sup: 4834; 4790; 4700; 4642