Article by: ETO Markets

Gold prices (XAU/USD) fell slightly ahead of the Federal Open Market Committee (FOMC) policy meeting as bulls turned cautious and awaited the Federal Reserve's decision to cut interest rates. The Fed is widely expected to slash interest rates by 50 basis points, weakening the dollar and contributing to a sustained rally in gold prices. At the same time, global geopolitical risks and concerns about China's economic slowdown have also supported safe-haven gold, further limiting the downside of gold prices.

Although gold prices have eased slightly from record highs, the upcoming policy easing by the Federal Reserve and the decline in US bond yields have been strongly supportive of gold. In addition, political uncertainty in the United States and tensions in the Middle East, such as Hamas's threat to escalate the hostage crisis, and Trump's assassination attempt, continue to boost risk aversion.

From a technical point of view, the price of gold shows the potential for further gains after the recent break above the resistance level of $…- $…. However, the Relative Strength Index (RSI) on the daily chart is close to overbought territory, suggesting the bulls may be under some pressure. The key resistance level for gold is currently at the round $… mark, and if it can break through, the next upside target could point to the uptrend channel resistance of $…- $….

On the downside, the $… support area should attract bargain hunters with further support in the $…-… area. A break below this support could trigger a technical sell-off and bring prices back down to the psychological $… level or even down to the $… support level.