Gold (XAU) Daily Forecast: Struggles Near $2,400; Is a Sell-off Looming?

Investors await more clues about the Federal Reserve’s plans, which will impact gold prices. This week’s flash PMI report will update the global economy and create short-term trading opportunities for gold.

Biden Exits Race, Fed Rate Cut Anticipated, Boosting Gold Prices

The US dollar weakened after President Joe Biden announced his exit from the presidential race on Sunday, causing investors to unwind trades betting on a Trump victory. Vice President Kamala Harris strengthened her position as the top Democratic candidate, while former President Donald Trump remains the favorite in betting markets.

Market participants now fully anticipate a September interest rate cut by the Federal Reserve, which has pressured the US dollar. This shift supports gold (XAU/USD) as investors seek safe-haven investments in the precious metal.

Geopolitical Tensions and Weak Chinese Growth Drive Gold Prices Higher

Geopolitical concerns, particularly the ongoing Russia-Ukraine war and conflicts in the Middle East, are boosting gold prices as investors seek safety. Meanwhile, China’s economy grew 4.7% year-on-year in the second quarter, falling short of expectations and slowing compared to earlier in the year.

Weaker growth, sluggish consumer demand, and a struggling property market have led to increased government intervention to restore confidence.

Therefore, geopolitical tensions and China’s weaker-than-expected economic growth are driving gold prices higher as investors seek safety amid global uncertainties and concerns over slower economic recovery.

Short-Term Forecast

Gold (XAU/USD) is poised to remain bullish above $2403.30. Immediate resistance at $2411.87, with key support at $2393.71. Fed rate cut expectations, and geopolitical tensions boost gold’s safe-haven appeal.