Gold Price Update: XAU/USD Reaches All-time High at $2,531.60 Amid USD Weakness
- Market Optimism Fades Ahead of FOMC Minutes Release
- China Emerges as Major Gold Buyer on Speculation of Weaker USD
- XAU/USD Corrective Decline Possible, But Bullish Sentiment Prevails
Gold prices surged to a record high of $2,531.60 on Tuesday, fueled by a weakening US Dollar and increased demand for the safe-haven metal, particularly from China. Expectations of a potential interest rate cut by the Federal Reserve have led to speculation of further USD depreciation, prompting Chinese investors to flock to gold. However, profit-taking in the US session has caused XAU/USD to retreat towards the $2,500 level.
Despite the reversal in equities and slight losses in US markets, overall market sentiment remains positive, keeping the US Dollar under pressure despite the intraday decline in XAU/USD.
Focus now shifts to the release of the FOMC Minutes on Wednesday, which could provide insight into the Fed’s future monetary policy decisions. However, market consensus already expects a rate cut in September, limiting the potential impact of the Minutes on the USD.
Technical Analysis of XAU/USD
The daily chart indicates that XAU/USD has room for further gains, with the recent pullback considered a corrective move. The pair remains well above its moving averages, signaling a bullish trend. While the Momentum indicator has retreated slightly, the RSI remains stable around 65, suggesting limited downside potential.
On the 4-hour chart, technical indicators show that the ongoing retracement is not indicative of a major decline. Moving averages continue to slope upwards, with support levels at $2,496.40, $2,485.10, and $2,427.20, and resistance levels at $2,510.00, $2,523.50, and $2,535.00.
Overall, XAU/USD remains in a bullish trend, supported by weakening USD and strong demand for gold as a safe-haven asset.