Article by: ETO Markets

Gold prices faced a pullback despite the ongoing uptrend, reversing some of the previous day’s gains but staying within the week’s trading range. Political uncertainty from the upcoming November 5 US presidential election, combined with Middle East tensions, continues to offer support to the safe-haven metal. 

However, this support is limited by renewed demand for the US Dollar, driven by expectations of reduced policy easing from the Federal Reserve. Strong US economic data has diminished the likelihood of another large rate cut in November, strengthening the dollar and applying pressure on the non-yielding Gold. 

In terms of technical analysis, the Relative Strength Index (RSI) shows a pullback from overbought conditions, suggesting that long holders may want to close their positions and consider shorting. If XAU/USD reaches $…, the next resistance level would be the year-to-date high of $…. On the other hand, if gold prices continue to pull back, the next support level would be $… (the September high), with further support at the 20-day Simple Moving Average (SMA) of $….