Gold continued to correct yesterday after reaching our rally target at $1391, falling as low as $1350 before finding support. This morning, gold remains under pressure and is currently trading around $1347, with the FOMC statement released tonight at 7pm expected to shed further light on the Fed's plans for tapering QE and interest rate guidance. With the UK Budget today, we may see quiet trading throughout the afternoon before the FOMC meeting takes centre stage - any increase in the rate of tapering could see gold under pressure and the dollar rally, however a pause or reassessment of the QE tapering programme would be positive for gold and see further dollar selling. Equities and oil surged higher yesterday, putting further pressure on gold, though the weak dollar is limiting losses in the yellow metal. Support can be found at $1340, $1330-$1332, $1322, $1312-$1315, $1307, $1295-$1300 and $1280. Resistance can be found at $1360, $1370-$1373, $1380, $1388-$1391, $1395-$1400, $1420 and $1435. The breakout above $1300 suggests an end to the intermediate term down trend and that a significant rally is now developing.

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