Gold News: Fed Policy in Focus as XAU/USD Holds Above $3,000, Eyes New Highs

Gold Prices Steady as Traders Await Fed Decision

Gold prices are firm on Monday, trading within Friday’s range as traders attempt to recover losses from last week’s late-session sell-off. The market remains near record highs, with key technical levels in focus as investors assess economic risks and the Federal Reserve’s upcoming policy decision.

At 10:51 GMT, XAU/USD is trading $2998.02, up $13.11 or +0.44%.

Gold Prices Hold Near Record Highs

After briefly surpassing $3,000 last week, gold hit an all-time high of $3,005.04 on Friday before retreating. The metal remains supported by safe-haven demand, with traders closely monitoring the Federal Reserve’s policy stance. A break above $3,005.04 would signal a continuation of the uptrend, while a drop below $2,978.50 could confirm a near-term reversal, potentially leading to further declines toward $2,942.64 and lower support at $2,880.25. The 50-day moving average at $2,838.00 remains a key level for the intermediate trend.

Independent analyst Ross Norman sees continued upside, citing strong buying interest on price dips driven by FOMO (fear of missing out). He anticipates gold reaching $3,150 sooner than previously expected.

Economic Concerns and Fed Policy in Focus

U.S. Treasury Secretary Scott Bessent warned on Sunday that a recession remains a possibility, adding to investor concerns over economic uncertainty. U.S. equities closed sharply lower last week amid escalating trade tensions, further boosting demand for gold as a hedge.

The Federal Reserve’s monetary policy meeting on Wednesday is a key event for traders. The central bank is expected to keep interest rates unchanged after cutting them by 100 basis points since September. Lower interest rates typically support gold by reducing the opportunity cost of holding the non-yielding asset.

UBS acknowledged gold’s overbought technical position but emphasized that investors remain cautious on U.S. equities and confident in gold’s strength.

Gold Prices Forecast: Bullish Outlook with Key Resistance Levels

Gold remains well-supported by economic uncertainty and a dovish Fed outlook. While short-term pullbacks are possible, strong demand on dips and ongoing geopolitical risks suggest a bullish bias. A sustained break above $3,005.04 could trigger further upside, with $3,150 as the next major target. However, failure to hold support at $2,978.50 could see increased selling pressure.

Traders will closely watch the Fed’s policy statement and market reaction for further direction.

More Information in our Economic Calendar.