Gold Price Forecast: XAU/USD corrective decline stalls ahead of $4,600

XAU/USD Current price: $4,617

• Unimpressive US data left the US Dollar at the mercy of sentiment.
• Speculative interest awaits clarity about Federal Reserve leadership.
• XAU/USD retreated after reaching fresh highs, buyers keep adding on dips.

Spot Gold extended its record rally on Wednesday to $4,642, slowly but steadily grinding north as risk sentiment turned off.  The US Dollar (USD) also found some favor in the dismal mood, resulting in the bright metal retreating towards the current $4,610 area.

The United States (US) published some relevant macroeconomic figures, which fell short of triggering some relevant action: The country reported that Retail Sales were up 0.6% in November, beating expectations, although the core reading was a miss, with the Retail Sales Control Group posting a modest 0.4% advance. The US also released shutdown-delayed Producer Price Index (PPI) data, which showed that the core annual PPI rose to 3% in November, signaling stubborn price pressures at the wholesale level.

Other than that, the focus remains on the Federal Reserve (Fed). Some Fed officials hit the wires, with Bank of Philadelphia's Anna Paulson saying she foresees further rate cuts later this year if the forecast meets their expectations.  Stephen Miran also shared his thoughts at a separate event, leaning dovish. Still, uncertainty about how the Fed will operate once current Chairman Jerome Powell steps down keeps investors uninterested.   

 XAU/USD short-term technical outlook

The 4-hour chart shows XAU/USD maintains its positive tone and trades above all its moving averages. The 20-period Simple Moving Average (SMA) rises above the 100- and 200-period SMAs, with the shorter one at $4,591.39 offering initial dynamic support. At the same time, the Momentum indicator turned flat above its midline, while the Relative Strength Index (RSI) indicator stands at 64, also lacking directional strength.

In the daily chart, the 20-day SMA stands at $4,438.80 while rising above the 100- and 200-day SMAs, with all three trending higher, in line with the dominant bullish trend. Finally, technical indicators partially lost their upward strength, but remain well above their midlines, reflecting the near-term retracement rather than suggesting upward exhaustion.

(The technical analysis of this story was written with the help of an AI tool.)