XAU/USD Extends Bullish Rally
Gold Price Forecast: XAU/USD approaches $3,700 on Dollar’s weakness
Gold extended its bullish rally for the third consecutive day on Tuesday, climbing to fresh all‑time highs just below $3,700 as the US Dollar weakened sharply. The US Dollar Index dropped to new two‑month lows, fueling demand for the precious metal.
Market sentiment is dominated by expectations that the Federal Reserve will announce a widely anticipated quarter‑point rate cut on Wednesday, with speculation that further easing could follow. Hopes of an accelerated easing cycle have hammered the Dollar and boosted safe‑haven demand for gold.
Recent economic data from the United States has highlighted a sharp deterioration in the labor market, while inflation remains moderate. This has raised concerns that the Fed may be behind the curve in adjusting policy.
Adding to the pressure, the President of the United States has urged the Fed to act decisively, calling for deeper cuts to support growth and housing. This political pressure has reinforced expectations of a dovish stance at the upcoming meeting.
From a technical perspective, XAU/USD has completed its consolidation phase and resumed its broader bullish trend. The Relative Strength Index (RSI) remains in overbought territory, but momentum is still strong, with no clear signs of reversal.
Overall, gold remains firmly supported by the weakening US Dollar and expectations of Fed easing. While resistance at $3,700 is a key hurdle, a sustained break above could open the path toward $3,740 and potentially higher. However, traders should also be cautious of a corrective pullback after such a rapid climb.