Gold Price News and Forecast: XAU/USD down 0.45%, but losses could be short-lived

FXStreet Team FXStreet

Gold Price Forecast: Wednesday’s close above $1950 keeps bulls alive ahead of Powell

Gold (XAU/USD) closed above $1950 on Wednesday, having staged a solid comeback from just above the $1900 mark. The yellow metal fell sharply to fresh weekly lows of $1903 after the US Durable Goods data surprised to the upside. The spot gained 1.27% on the day, as the US dollar eventually slipped across the board in tandem the Treasury yields amid dovish expectations from the Federal Reserve (Fed) Chair Jerome Powell’s speech (due at 1310 GMT) at the Jackson Hole Symposium. Powell is expected to deliver a dovish tweak to its monetary policy by hinting at adopting average inflation targeting (AIT) next month. The new framework is mainly aimed to push up inflation, which could exert additional downside pressure on the greenback. The US stocks hit another record high, which hurt the haven demand for the dollar and boosted gold prices.

Gold Price Analysis: XAU/USD down 0.45%, but losses could be short-lived

Gold is trading near $1,945 per ounce, representing a 0.45% decline on the day. The losses could be reversed during the day ahead as the daily chart is reporting a bullish reversal pattern.

The metal first created a Doji candle on Tuesday, indicating indecision in the marketplace and then carved out a long-tailed bullish engulfing candle on Wednesday. In other words, the market has gone from being indecisive to bullish. As such, the hourly chart resistance at $1,962 could come into play. Acceptance above that level would open the doors for $2,000.

EUR/USD tumbles below 1.1800 as Middle East turmoil drives US Dollar demand

The EUR/USD pair falls to near 1.1770 during the early Asian session on Monday, pressured by a renewed US Dollar demand. The Greenback gathers strength against the Euro as the conflict across the Middle East is heightening traders' anxiety, boosting the safe-haven currencies.

GBP/USD declines below 1.3450 on Middle East tensions, UK political uncertainty

The GBP/USD pair attracts some sellers to around 1.3420 during the early Asian session on Monday. The US Dollar edges higher against the Cable amid escalating tensions in the Middle East after recent US-Israeli strikes on Iran over the weekend.

Gold jumps over 2% toward $5,400 after US, Israel attack Iran

Gold is on fire at the start of the week, a widely expected move, as investors seek harbor in the traditional store of value, following the continued US and Israel attacks on Iran. The bright metal opened with a bullish gap of about $17 and rallied toward the $5,400 level as Asian traders hit their desks and reacted negatively to the weekend news of the Middle East conflict, rushing for cover in Gold.

Iran escalation: Quick thoughts on markets

Markets are likely to open the week with risk-off, with declines led by airlines, cyclicals and trade-exposed names, while energy, defense and “strategic” sectors may be relatively steadier.

Crisis in the Middle East: The market reaction

A primer on how markets will open on Monday, and why geopolitical risk may not be easily absorbed by financial markets this time around. Geopolitics and events between Iran, the US and the wider Middle East will dominate financial markets on Monday. The situation has continued to escalate as we move through Sunday.

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