Gold dips to $1280 ahead of Fed meet

Gold on Tuesday inched lower but remained within reach of a four-week high level of $1287 touched on Monday and is currently trading around $1280 level, awaiting for fresh cues from the Federal Reserve's monetary policy decision. 

On Monday, the yellow metal touched a four-week high as sell-off in global equities boosted the metal's safe-haven appeal. Moreover, uncertainty surrounding the possible outcome and economic implication of the Brexit referendum also seems to extend support for the precious metal. 

On Tuesday, the metal seems to witness some profit-taking move ahead of the much awaited Fed monetary policy decision announcement on Wednesday. However, given the prevailing global risk-off sentiment and expectations of a status-quo Fed monetary policy stance, the metal seems unlikely to witness a sharp correction from current levels.

Technical levels to watch

On the immediate downside, $1271-70 area now seems to provide immediate support and is closely followed by support near $1263-62 horizontal area. Weakness below $1263-62 support might get extended but is likely to be restricted around 50-day SMA strong support near $1250 round figure.

On the flip side, Monday's high level around $1288 level (also coinciding with May 16 high), followed by $1295 (May 06 high) are likely to act as immediate resistance levels. Momentum above this immediate resistance levels should assist the metal to move back above $1300 mark and retest a multi-month highs resistance near $1303-05 region.