Gold Price Forecast: XAU/USD hovers around $1,930 amid caution ahead of Russia-Ukraine peace talks

Gold price hovers around $1,930 as investors await Russia-Ukraine truce talks.
Powell’s testimony backs a 25 bps rate hike in March’s monetary policy meeting.
A downfall in the Russian economy and Ukraine’s backfire may force Russia to choose a ceasefire.

Sagar Dua FXStreet

Update: Gold price is moving back and forth in a tight range around $1,930, as the downside remains capped by resurfacing global economic growth concerns amid soaring energy prices. The Ukraine crisis has rocketed oil prices, aggravating raging inflation risks. On the other side, gold’s upside remains capped by a broadly firmer US dollar, as it continues to draw safe-haven flows amid a 25bps rate hike hinted by Fed Chair Jerome Powell next week.

Looking ahead, if risk-aversion intensifies, then the greenback could extend the recent bullish momentum, dragging gold price back in the red zone. All eyes remain on the Ukraine-Russia peace talks and US economic releases.

Read: A geopolitical disaster could not take this market down

Gold (XAU/USD) is oscillating in a narrow range of $1,924.70-1,933.42, as investors are waiting for the Russia-Ukraine peace talks, which are due on Thursday.

The precious metal witnessed some significant offers near $1,950 on Wednesday, as investors expected that Russia may prefer a truce now, as its economy has melted down on sanctions from the Western leaders. Moreover, the Ukrainian military has shown fierce resistance to Russian military troops. This has brought a rebound in the risk-off impulse but the safe-haven gold fails to benefit amid the US dollar's strength.

US Federal Reserve (Fed) chair Jerome Powell, in his testimony on Wednesday, underpinned a 25 basis points (bps) interest rate hike in March’s monetary policy meeting. This reduced the odds of an aggressively tightening policy, however; the doors of a 50 bps interest rate hike are still open. The certainty of a 25 bps interest rate hike was expected to push the gold prices higher but improvement in the risk appetite of investors mitigated the strength of the precious metal against the greenback, which left the gold prices juggling around $1,930.

Meanwhile, the US dollar index (DXY) has opened with a bullish opening gap on Thursday. The 10-year Treasury yields have surged on Wednesday post the advocacy of a 25 bps interest rate hike by the Fed, capping the non-yielding gold's upside attempts.

Although the Russia-Ukraine negotiation talks will remain a major driver, investors will also focus on US Initial Jobless Claims and ISM Services PMI, which are due later this Thursday.

Gold Price: Technical analysis

On an hourly scale, gold price witnessed a sharp rally after breaching a symmetrical triangle on the upside. The precious metal attracted a pullback later and continued to trade in a symmetrical triangle (2), which signaled for further consolidation in the absence of a potential trigger.

The 50-period and 200-period Exponential Moving Averages (EMA) are trading flat, which indicates a lackluster move ahead.

The Relative Strength Index (RSI) (14) is oscillating in a range of 40.00-60.00, which adds to the rangebound filters.

Gold Price: Hourly chart

XAU/USD

Overview
Today last price	1929.14
Today Daily Change	3.84
Today Daily Change %	0.20
Today daily open	1925.3

Trends
Daily SMA20	1873.05
Daily SMA50	1837.87
Daily SMA100	1818.83
Daily SMA200	1809.56

Levels
Previous Daily High	1950.3
Previous Daily Low	1913.94
Previous Weekly High	1974.51
Previous Weekly Low	1878.22
Previous Monthly High	1974.51
Previous Monthly Low	1788.67
Daily Fibonacci 38.2%	1927.83
Daily Fibonacci 61.8%	1936.41
Daily Pivot Point S1	1909.39
Daily Pivot Point S2	1893.49
Daily Pivot Point S3	1873.03
Daily Pivot Point R1	1945.75
Daily Pivot Point R2	1966.21
Daily Pivot Point R3	1982.11

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.

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