Gold gave back most of its losses on Wednesday as the dollar pared gains and bullion shrugged off earlier pressure from U.S. Federal Reserve officials' comments that raised expectations of an interest rate hike in March.
The Federal Reserve is setting the stage for a U.S. interest-rate increase later this month, with another policymaker Wednesday making the case that economic strength at home and stability abroad have created a window for action. We should begin the process sooner so we can ensure that it is gradual and patient," Dallas Fed President Robert Kaplan, a voting member this year on the Fed's policy committee, said. The comments were the latest in a period with an unusually high concentration of Fed speeches, with four out of five Federal Reserve Governors - including Chair Janet Yellen - speaking this week ahead of the March 14-15 rate meeting. New internal Fed rules on public communications make Friday the last chance to set up market expectations before the next Fed meeting.
President Donald Trump told Congress on Tuesday he opened the door on Tuesday to a broad overhaul of the U.S. immigration system, a shift from his hardline campaign rhetoric. He emphasized his desire to focus on problems at home by boosting the U.S. economy with tax reform, a $1 trillion infrastructure effort and an overhaul of President Barack Obama's signature healthcare law, known as Obamacare.
On technical front, gold’s upward momentum remained intact, with its daily chart holding above the 20-day moving average and weekly chart supported by the 200-week moving average. But resistance can be found at the 200-day and 50-week moving average. The MACD index shows retaining steam for a breakthrough. Investors shall be cautious ahead of Fed’s policy meeting in March.
Silver rose 0.6 percent to $18.40 per ounce, outperforming gold and keeping climbing along the upper band of Bollinger path. Currently, the 20-day moving average is about to cross over the 200-day moving average, while the 50-day moving average move up sharply, adding the likelihood to rise further to $18.8. But the white metal is expected to meet heavy downside pressure at the level, requiring technical support for extending its gains.

 
Dealing Room, ICBC Beijing Branch
Lv Yan

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