As seen above, the XAU/USD pair shows the value of gold in US dollars. Recently, it has been holding firm under the important $3,400 level. Market participants are attack at the Federal Reserve, which is expected to cut interest on its next verdict. For now, XAU/USD retains a neutral-to-bullish position, supported by a bullish technical setup and moving averages.
During the past week, XAU/USD was able to make a new higher high before pulling back in a minor correction. Their performance is symptomatic of the pair’s overall grit and sharp ability to climb upward. On the daily chart, XAU/USD is still trading well above its 20 Simple Moving Average (SMA) at $3,297.20. Another positive sign for gold is the 20 SMA pushing higher above the 100 SMA, adding to the bullish sentiment surrounding the yellow metal. XAU/USD is still trading a good distance above all its moving averages, implying ongoing strength.
The 100 and 200 SMAs in the long-term are both bullishly inclined. This stair step pattern indicates a powerful, high momentum bullish trend. On the downside, support levels are at $3,392.25, $3,277.60 and $3,263.10, and on the upside, resistance levels at $3,430.20, $3,444.25 and $3,468.30. These ranges will be essential to watch for traders during the tumultuous market formations in the days leading up to the Fed’s meeting.
Market players are keenly anticipating the Federal Reserve’s next steps, particularly comments from Chairman Jerome Powell regarding the central bank’s independence. This expected conversation, if executed to required societal expectations, may considerably influence the heights of gold in the upcoming few days. Introductory trade discussions between the US and China are set to begin next Wednesday. These negotiations have the potential to move XAU/USD drastically. Ongoing tensions over trade enforcement policies are increasingly putting the pressure on US policymakers.
President Donald Trump’s tariffs are still the biggest source of uncertainty dogging market analysts. As policymakers continue to work through these matters, their choices will have the potential to tip investor mood in favor of gold and other safe-haven investments.
Technical indicators for XAU/USD now range within positive territory providing a further confirmation to its current neutral-to-bullish short-term outlook. Traders are waiting to see how the combination of all these factors will determine the future path of gold prices.