A Record Just a Step Away: Gold Aims for $3,700!
Gold (XAU/USD) held near its all-time record at the start of the European session, still below the psychological $3,700 threshold. Sentiment was boosted by the weakening of the US dollar to its lowest level since July 7, keeping the non-yielding asset's appeal strong.
Market focus is on the Fed's decision on Wednesday. Market participants strongly believe a 25 bps cut (with a small chance of a 50 bps cut), so the primary focus is on the latest dot plot and Powell's tone regarding the future interest rate path.
In addition to interest rates, safe-haven flows are also supported by geopolitical uncertainty, including the Russia-Ukraine war. This combination has kept gold comfortably near its peak in recent weeks.
However, some traders are choosing to wait ahead of the central bank risk event—prices have risen rapidly in recent days, so there's still room for technical leeway. If the Fed's tone is less dovish, the potential for short-term consolidation opens up.
Conversely, a clear signal of a cut and dovish guidance from Powell could trigger a clear test above $3,700 and open the door to a new record. The US dollar's response after the meeting will determine its next direction. (ayu)
Source: Newsmaker.id
