Gold declines below USD 1220

New York (Oct 29)  Gold prices have dipped below the USD 1220/Oz levels after the Federal Reserve announced the end of its monthly bond purchase program, while mentioning that the interest rates would continue to remain at the record low levels for a considerable period of time.

Gold is not trading 0.78% lower at USD 1219/Oz levels, tracking the rise in the US Ten-year treasury yields to 2.35%. Meanwhile, the two-year treasury yield, a barometer of short-term interest rate expectations, has inched sharply higher to 0.477%. Moreover, the yellow metal is also losing steam as the Fed warned that inflation expectations are likely to remain low owing to a dip in the energy prices.

The yellow metal is likely to find support on the weakness in the US Equity futures., although the rising Treasury yields and the sharp rise in the US Dollar Index is likely to push Gold lower.

Gold Technical levels

Gold has an immediate support at 1215, under which the prices can fall to 1207 levels. On the flip side, prices may re-test 1230 levels if the immediate resistance located at 1225 is breached.

Source: FXstreet