Following Wednesday's Fed meeting, gold took some serious beating and it still hasn’t recovered those losses. And today, gold has been trading near its lowest level in 30 days, while US Treasury yields and the dollar have started to soar on the back the Fed meeting.
Basically, officials revising the timetable for interest rate hikes have brought a taper tantrum for the gold price. For investors, the opportunity cost of holding non-interest bearing assets have increased, and gold has become a less attractive asset for them for now.
The price level to watch is the 1,800 and as long as the price continues to trade above this, we still have hope for the bulls. However, if the price drops below this price level, we could see some intense sell off.
For the time being, it is pretty clear that prices are way oversold and a rebound is in the cards.
