Gold prices (XAU/USD) are under pressure, influenced by a stronger US Dollar and reduced expectations for aggressive Fed rate cuts. The ongoing geopolitical tensions in the Middle East continue to provide some support for gold.
Key Factors:
- US Dollar Strength: The US Dollar has gained ground, making gold more expensive for investors holding other currencies.
- Fed Rate Expectations: The market is now pricing in a higher probability of a smaller 25 basis point rate cut in November.
- Geopolitical Risks: The escalating conflict in the Middle East continues to support the safe-haven appeal of gold.
Technical Analysis:
- Downward Trend: Gold prices are facing downward pressure, with potential for further declines.
- Support Levels: The 20-day EMA at $2,550 and the trendline from the April 12 high are potential support levels.
- RSI: The Relative Strength Index (RSI) is declining, indicating a weakening of momentum.
Overall Outlook:
Gold prices are likely to remain volatile, influenced by geopolitical developments, economic factors, and market sentiment. Traders should monitor technical indicators for signs of a trend reversal.
