Gold on its knees, -0.70%, ahead of the FOMC event, dollar up 0.11%

Gold sold off back on the 16th April and has not looked back in a decisive bear trend while the dollar has been staging a comeback. That same rings true today ahead of the FOMC meeting while US data improves on the same day after a number of disappointments.

• French election: Is the market too comfortable with a Macron win?
• Visit the French Elections Page here!

The dollar capped gains gold today at 1257.34 and made a recent fresh low of 1245.03 in a $12.00 drop and close to three-week lows as markets bet further that the Federal Reserve would hike interest rates in June, although NOT today. 

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• FOMC meeting: no game changer for the USD

The Institute for Supply Management said its non-manufacturing purchasing managers’ index climbed to 57.5 in April from 55.2 in March, besting median forecasts of 55.8. Earlier, the ADP report was good enough as a prelude to solid nonfarm payrolls on Friday with 177,000 new positions for the month beating the expectations of 175,000. Much today will depend on the FOMC's statement and also the French debate ahead of this weekend's runoff between Le Pen and Macron as an additional risk after the nonfarm payrolls event on Friday. The latest polls have centralist Macron leading by around 20 percentage points, over the far-right candidate Marine Le Pen.

One aspect in the market that is slowing down the dollar's march, and subsequent downside int the yellow metal are US yields. US 10 years still struggle with momentum to the upside through 2.3% and have been ranging today between 2.2767 - 2.3054% today only. Gold needs to get back to 1280 in order to reemerge in the bullish channel from 1197 and mid-March business, but will only be a bullish position when above the 20th MArch commencing trend line;s high of 1295.