Gold exchange traded funds were lower before Wednesday’s announcement from the Federal Reserve on interest rates and the economy. Precious metal ETFs could see a volatile session as Fed chief Ben Bernanke also holds a press conference following the central bank’s announcement.
Gold ETFs are trying to make a push above the 50-day exponential average thanks to a strong rally to start the year. Also, gold prices are facing trendline resistance that goes back to the all-time high in September, writes J.C. Parets at All Star Charts.
“The only condition that matters for gold is if inflation expectations are rising. Since the first week of this year, there has been a dramatic repricing of inflation expectations,” Michael Gayed, chief investment strategist with Pension Partners, said, reports Paul R. Lamonica for CNN Money. [Gold ETFs Size up 200-day moving Average as Dollar Weakens]
CNN Money reports that gold has trended up 7% so far in 2012, almost equal to the Nasdaq.
China is another country that will influence the future performance of gold. Economic data suggesting China will avoid a hard landing has buoyed commodity and precious metals prices.