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Gold Price Forecast: XAU/USD remains vulnerable as sellers target $4,000

  • Gold remains under pressure as rising Fed rate hike expectations and elevated US Treasury yields weigh on the non-yielding metal.
  • US-Iran tensions support safe-haven demand for the US Dollar, adding to the downside pressure on Gold.
  • XAU/USD maintains a bearish technical bias below key moving averages, although oversold momentum indicators could limit the immediate downside.

Gold (XAU/USD) remains under heavy selling pressure at the start of the week, weighed down by rising expectations of further monetary tightening from the Federal Reserve (Fed). Higher Oil prices are fueling inflation concerns and keeping US Treasury yields elevated, reducing the appeal of the non-yielding precious metal.

Meanwhile, persistent tensions between the United States (US) and Iran are supporting safe-haven demand for the US Dollar (USD), adding further pressure on Gold. Markets are now pricing in around a 68% chance of another Fed rate hike in October, while upcoming comments from Fed officials and key US economic data are likely to remain important drivers for XAU/USD.

Chart Analysis XAU/USD

In the daily chart above, XAU/USD trades at $4,142.32, keeping a bearish near-term bias as it holds below the 100-day simple moving average (SMA) at $4,298.70 and the 200-day SMA at $4,540.39. The pair also remains under the descending trend-line reference near $4,305.00, suggesting that recent rebounds are still capped within a broader corrective phase. The Relative Strength Index (14) at 35.69 hovers just above oversold territory, hinting that downside momentum is softening but not yet reversed.

On the topside, immediate resistance is clustered around the 100-day SMA at $4,298.70 and the trend-line at $4,305.00, with a stronger barrier at the 200-day SMA near $4,540.39 before the horizontal resistance at $4,697.00. On the downside, the next notable support stands at the horizontal level of $3,941.00, where buyers would be expected to emerge to defend the broader uptrend, while a sustained break below the current area would likely extend the corrective slide toward that floor.

Chart Analysis XAU/USD

In the four-hour chart above, XAU/USD is extending its slide below the key simple moving averages and preserving a bearish near-term bias. The 100-period simple moving average (SMA) at $4,336.51 and the 200-period SMA at $4,410.85 both sit well above spot, suggesting the metal remains in a corrective phase under substantial overhead supply. The Relative Strength Index (14) has slipped to around 23, hinting at oversold conditions, but this momentum backdrop alone is not yet sufficient to overcome the prevailing downside pressure while price holds beneath the clustered moving-average barriers.

On the topside, initial resistance appears at the horizontal level near $4,250.00, ahead of the 100-period SMA at $4,336.51 and the 200-period SMA at $4,410.85, with a higher resistance marker seen at $4,697.00. On the downside, immediate support is aligned at $4,120.00, followed by a more robust structural floor around $4,000.00, where a stronger reaction could emerge if the current oversold readings start to attract dip-buying interest.

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

Author

Ghiles Guezout

Ghiles Guezout is a Market Analyst with a strong background in stock market investments, trading, and cryptocurrencies. He combines fundamental and technical analysis skills to identify market opportunities.

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