Gold (XAU) Daily Forecast: Prices Hold at $2,660 as Fed Rate Cut Expectations Grow

Market Overview

Gold prices (XAU/USD) edged higher on Thursday, trading around $2,660 during the Asian session, close to its all-time high set the previous day. Expectations of a significant interest rate cut by the U.S. Federal Reserve have pressured the dollar, boosting demand for non-yielding assets like gold.

As investors anticipate more dovish monetary policy, gold remains attractive despite slightly overbought conditions.

U.S. Dollar Weakness and Fed Signals Support Gold

The U.S. dollar struggled to recover following weak economic data, which heightened expectations for a dovish stance from the Fed. Investors are pricing in a strong chance of a 50-basis-point rate cut in November. This ongoing uncertainty supports gold’s appeal as a safe haven.

Fed Chair Jerome Powell’s speech on Thursday is expected to clarify future rate cuts. Markets are also monitoring key economic releases such as Q2 GDP, Weekly Jobless Claims, and Durable Goods Orders for further signals on the economy’s trajectory.

Economic Worries and Geopolitical Tensions Drive Safe-Haven Demand

Concerns about China’s economic recovery persist, despite recent stimulus measures. Investors are skeptical about the effectiveness of these efforts, which has heightened fears of a potential global economic slowdown. This uncertainty is pushing more investors toward safe-haven assets like gold.

Geopolitical risks, especially rising tensions in the Middle East, further bolster gold’s appeal. As conflicts escalate and uncertainties remain, investors increasingly seek the stability that gold offers in times of crisis.

Short-Term Forecast

Gold (XAU/USD) continues to trade around $2,660, supported by a weak dollar and expectations of further Fed rate cuts. Investors eye a potential breakout.

Gold Prices Forecast: Technical Analysis

Gold (XAU/USD) is currently trading at $2,661.28, up 0.18%, as it holds above its key pivot point at $2,659.45. Prices are consolidating within a narrow range, with immediate resistance at $2,670.40 and further at $2,676.83 and $2,683.64.

Support is holding at $2,652.41, with additional safety nets at $2,647.12 and $2,641.51. The 50-day EMA at $2,649.72 provides solid support, while the 200-day EMA at $2,607.74 remains a long-term anchor.

Gold is trading in a symmetrical triangle pattern, suggesting a potential breakout soon. Bulls are favoured above $2,659, but a break below this level could trigger a bearish move.