24.09.202417:14 Forex Analysis & Reviews: XAU/USD. Analysis and Forecast

Today, the price of gold is retreating from a new all-time high around the $2,640

The increase in U.S. Treasury yields is helping to revive demand for U.S. dollars, leading to some profit-taking in gold. This occurs amid mildly overbought conditions observed on the daily chart.

However, any significant corrective decline in the precious metal is expected to be limited due to rising expectations of a more aggressive monetary easing by the Federal Reserve. Additionally, political uncertainty in the U.S., bleak global economic prospects, and ongoing geopolitical risks are expected to continue supporting the safe-haven appeal of gold. Furthermore, traders are awaiting a speech by Federal Reserve Governor Michelle Bowman, which could trigger renewed momentum for this non-interest-bearing asset.

From a technical perspective, the recent breakout and sustainability above the $2,600 level can be seen as a new trigger for bulls. However, the Relative Strength Index (RSI) on the daily chart stands at 70, suggesting some caution. Therefore, it would be prudent to wait for a moderate pullback or a short-term consolidation before positioning for the next upward move.

Any corrective decline is likely to attract new buyers around the psychological level of $2,600, below which the price could drop to the horizontal support zone at $2,560. The next relevant support is located near the breakout level at $2,532, with the key psychological support set at $2,500. A decisive break below this level would shift the short-term bias in favor of the bears, paving the way for a more significant decline.