Gold Futures: Scope for further recovery

Open interest in gold futures markets rose by just 575 contracts on Tuesday, partially reversing the previous daily drop according to advanced prints from CME Group. Volume, instead, dropped by around 5.5K contracts following two consecutive daily builds.

Gold: Next support of note comes at the 200-day SMA

Tuesday’s uptick in gold prices was amidst a small build in open interest, which opens the door to a potential continuation of the ongoing bounce in the very near term. However, the imminence of the FOMC event and a potential hawkish outcome could force the yellow metal to lose further ground and test the key 200-day SMA, today at $1834.