Gold was little changed ahead of a U.S. Federal Reserve policy meeting on Tuesday and Wednesday, with analysts saying the U.S. central bank could take an aggressively hawkish posture of signaling a balance sheet reduction later this year and another interest rate increase in December.
Spot gold was up 0.08 percent at $1,266.92 an ounce, having shed 1 percent on Friday in its biggest one-day percentage fall since May 18. U.S. gold futures settled down 0.2 percent at $1,268.90.
Overall, precious metals markets are waiting for the outcome of the Fed's meeting on Wednesday. Higher rates, as expected by the market, could boost the dollar, making commodities priced in the greenback more expensive for holders of other currencies.
On technical front, gold was little changed, signaling signs of stabilization at this level. But the MACD index is about to form a dead cross at highs, suggesting shrinking momentum column. Investors shall remain cautious ahead of the FOMC’s statement on interest rate hike. 
Silver fell more than 1 percent to a 2-1/2-week low of $16.87 an ounce, diverging from gold to close around the 30-day moving average of $16.96. Historically, market would follow silver’s trajectory when the two precious metals diverged. Silver is expected to keep testing the support of the 30-day moving average. The next support can be found at $16.82.

 
Dealing Room, ICBC Beijing Branch
Huang Han

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