Gold Price Forecast: XAU/USD struggles to find direction as focus shifts to Fed policy

Gold price is inside the woods as investors are awaiting the Fed policy announcement for further guidance.
The USD Index slipped firmly from 102.17 despite the upbeat Employment Cost Index and consistency in consumer spending.
Lengthy consolidation in the Gold price would be followed by wider ticks and heavy volume after an explosion

Sagar Dua FXStreet

Gold price (XAU/USD) is hovering around $1,990.00 in the early Asian session. The precious metal is struggling to find any direction as investors are awaiting the announcement of the interest rate decision by the Federal Reserve (Fed). The yellow metal is bounded in a range of $1,970-2,010 from the past week as investors are anxious about knowing the importance of May’s monetary policy meeting.

S&P500 settled last week with 1% gains despite a sell-off in the initial days. After digesting renewed fears of United States banking woes investors shifted their focus on upbeat quarterly earnings from technology stocks. Also, Friday’s bullish closing portrays an upbeat market mood.

The US Dollar Index (DXY) slipped firmly from the weekly high of 102.17 on Friday despite an upbeat Employment Cost Index and consistency in consumer spending. The Labor Cost Index (Q1) jumped to 1.2% from the consensus and the former release of 1.1%. A higher labor cost index indicates that firms still offer higher wages to attract talent due to labor shortage.

Meanwhile, the monthly core Personal Consumption Expenditure (PCE) Price Index remained consistent with estimates and former acceleration at 0.3%. The preferred tool of the Fed to judge the overall context of inflationary pressures in the US economy landed at 4.6% higher than expectations of 4.5% but lower than the former release of 4.7% on an annual basis, indicating stubbornness in core inflation.

Gold technical analysis

Gold price is inside the woods from the past week in a range of $1,969-2,014 on a four-hour scale. Lengthy consolidation indicates a sheer volatility contraction, which is expected to be followed by wider ticks and heavy volume after an explosion.

Advancing trendline from March 22 low at $1,934.34 is acting as a cushion for the Gold bulls.

The 20-period Exponential Moving Average (EMA) at $1,990.15 is continuously hovering around the Gold price, hinting at a sideways performance.

Also, the Relative Strength Index (RSI) (14) is oscillating in the 40.00-60.00 range, indicating an absence of a critical trigger.

Gold four-hour chart

XAU/USD

Overview
Today last price	1989.92
Today Daily Change	0.00
Today Daily Change %	0.00
Today daily open	1989.92

Trends
Daily SMA20	1999.67
Daily SMA50	1933.99
Daily SMA100	1897.52
Daily SMA200	1807.42

Levels
Previous Daily High	1995.07
Previous Daily Low	1976.28
Previous Weekly High	2009.41
Previous Weekly Low	1974.13
Previous Monthly High	2009.88
Previous Monthly Low	1809.46
Daily Fibonacci 38.2%	1987.89
Daily Fibonacci 61.8%	1983.46
Daily Pivot Point S1	1979.11
Daily Pivot Point S2	1968.3
Daily Pivot Point S3	1960.32
Daily Pivot Point R1	1997.9
Daily Pivot Point R2	2005.88
Daily Pivot Point R3	2016.69

Author

Sagar Dua

FXStreet

Sagar Dua is associated with the financial markets from his college days. Along with pursuing post-graduation in Commerce in 2014, he started his markets training with chart analysis.

AUD/USD sticks to positive bias above 0.7100; lacks bullish conviction

AUD/USD trades with a positive bias for the second straight day, holding above 0.7100 in the Asian session on Friday as softer US bond yields keep US Dollar bulls on the back foot. Furthermore, hawkish RBA Governor Bullock's comments boost rate hike bets and support the Aussie. However, the Fed's hawkish outlook, along with geopolitical uncertainties, limits USD losses and caps the pair.

USD/JPY sits at two-week highs above 156.00 ahead of BoJ verdict

USD/JPY catches some bids in the Asian session on Friday after data showed Japan's core consumer inflation held near the BoJ’s 2% target in August. The pair trades above 156.00 as traders await the BoJ's expected interest rate hike to a 31-year high. Meanwhile, softer US bond yields undermine the US Dollar, capping the pair's upside.

Gold holds above $4,350 as softer US bond yields cap USD

Gold trades with a positive bias for the second straight day and holds above $4,350 during the Asian session on Friday, though the upside seems capped. US bond yields move away from multi-year highs amid a pullback in oil prices, capping the US Dollar and supporting the non-yielding bullion. However, the Fed's hawkish stance and geopolitical risks limit USD losses, keeping XAU/USD below the weekly top, set on Thursday.

S&P Global to acquire OpenZeppelin in on-chain security expansion

S&P Global (SPGI) has agreed to acquire blockchain security firm OpenZeppelin as the financial data and analytics company expands its on-chain risk assessment capabilities. The acquisition, announced Thursday, will bring OpenZeppelin’s smart contract security services, development tools and open-source libraries into S&P Global’s existing digital asset and risk assessment business.

Silver is the metal the Copper rebound left behind

Copper producers answered a price near $14,000 a tonne by making more copper in the first half of 2026, and the way they did it means the silver shortfall gets no relief from the mines that supply more than a quarter of the world's silver. Copper is produced two ways.

How Japan became the World's Banker and why that era may be ending

Japan's ultra-low interest rates helped finance trillions of dollars in global investments for more than a decade, making the Japanese Yen one of the world’s cheapest sources of funding. With the Bank of Japan expected to tighten policy again this week, that advantage may be entering a new phase. While most major economies raised interest rates, Japan remained the world's outlier.