Gold price edges higher to $1275, focus remains on FOMC

London (Nov 1)  Gold edged higher through the early European session on Wednesday and recovered major part of overnight losses, albeit struggled to move past $1277 supply zone.

On Tuesday, a resurgent US Dollar, supported by a duo of upbeat US economic reports, was seen exerting pressure on dollar-denominated commodities - like gold.

Heading into a busy second half of the week, featuring key central bank monetary policy meetings (FOMC & BOE) and the keenly watched US monthly jobs report (NFP), investors turned a bit cautious, which was eventually seen benefiting the precious metal's safe-haven appeal.

Meanwhile, a follow-through uptick in the US Treasury bond yields, coupled with global risk-on trade might continue to keep a lid on any additional strong up-move for the commodity, at least for the time being.

Later during the NA session, the US macro data - ADP report and ISM manufacturing PMI, might help grab some short-term trading opportunities. Investors' focus, however, would remain glued to the FOMC decision, which should provide fresh hints over the central bank's near-term monetary policy outlook and eventually provide fresh directional impetus for the non-yielding metal.

Technical levels to watch

On a sustained move beyond $1277-78 immediate hurdle could accelerate the up-move towards $1283-84 horizontal resistance before the commodity eventually darts towards its next major hurdle near the $1290-92 region.

Meanwhile, on the downside, immediate support is now pegged at $1275 level and is closely followed by support near the $1268 region. Break below the mentioned supports is likely to extend the slide towards $1260 support.

FXstreet