Gold Holds Highs, Is There More to Come in the Rise?
Gold (XAU/USD) prices eased slightly from their highest levels since April 22, touched during the Asian session on Monday, although a significant correction seems elusive. Against the backdrop of persistent trade-related uncertainties, further escalation of geopolitical tensions in the Middle East turned out to be a key factor that benefitted the bullion as a safe-haven asset. Moreover, growing acceptance that the Federal Reserve (Fed) will lower borrowing costs further lent some support to the non-yielding yellow metal.
However, traders seemed reluctant to place any aggressive directional bets and preferred to wait for the outcome of the two-day FOMC policy meeting on Wednesday. Meanwhile, the US Dollar (USD) attempted to build on its modest recovery from three-year lows touched on Friday, which acted as a headwind for Gold prices. Additionally, a generally positive tone around equity markets contributed to capping gains for the precious metal. That said, the fundamental backdrop seems tilted in favor of the XAU/USD bulls.
Source: FXStreet
