Gold Edges Higher Amid Rising Rate Cut Expectations
Gold prices showed renewed strength in early Monday trading, buoyed by increasing speculation that the U.S. Federal Reserve could initiate rate cuts sooner than previously anticipated. With personal spending and income data indicating a slowdown in economic activity, investors are betting that the Fed may be prompted to ease monetary policy. A weaker U.S. dollar, resulting from these expectations, typically supports gold by making it more affordable for international buyers.
Trade Optimism and Geopolitical Calm Ease Safe-Haven Demand+
While the outlook for rate cuts has created a tailwind for gold, improving global sentiment is acting as a counterweight. Recent developments in U.S. trade negotiations, particularly the expectation of finalized agreements with major trading partners, have reduced investor anxiety. Additionally, easing tensions in regions like the Middle East and between the U.S. and China have softened the demand for traditional safe-haven assets, including bullion.
Investors Await Fed Commentary for Market Clarity
Market participants are now looking ahead to comments from key Federal Reserve officials scheduled for later in the day. Any new signals regarding the central bank’s rate path could inject volatility into gold markets. While longer-term technical indicators continue to favor a bullish outlook, short-term momentum remains cautious. Traders appear hesitant as they await fresh cues that could confirm or challenge the current market narrative.
Technical Landscape Shows Key Levels to Watch
From a technical perspective, gold remains above its 100-day Exponential Moving Average, maintaining a bullish posture in the broader trend. However, momentum indicators like the RSI suggest possible short-term softness. If the price breaks above the recent high of $3,350, a move toward $3,400 or even $3,425 could unfold. On the downside, a drop below $3,170 may expose further weakness toward $3,120, setting up key zones to monitor in the days ahead.
