Critical day for gold
On Tuesday, the metal reached a low of $1,317 before recovering to close at $1,324.80, which is right at the pivotal $1,325 level. The better-than-expected ADP and GDP data is definitely putting pressure on gold, and has sent the market toward Tuesday's lows.
(Read more: Gold drops after stronger-than-expected GDP)
Good data pose a problem for gold, because it could indicate that the Fed will taper quantitative easing relatively soon. But the Federal Open Market Committee announcement Wednesday afternoon should shed a bit of light, and that's why it will be crucial for gold.
At this point, a close above $1,340.90 is needed to provide positive momentum, and a close above $1349.20 to $1,352 is needed to signal an upside break out of the current range.