FX.co ★ XAU/USD. Analysis and Forecast

Gold starts the new week on a softer note, retreating from Friday's record high while maintaining a defensive stance and holding the $2,500 level. There is growing consensus that the Federal Reserve will lower borrowing costs in September, which is leading to a decline in the U.S. Treasury yields. This, in turn, pushes the U.S. dollar to its lowest level since January, which benefits gold.

Additionally, the risk of further geopolitical tensions escalating in the Middle East helps limit the decline in precious metals prices. However, it is prudent to wait for additional signals on the Fed's rate-cut path before opening new positions. Therefore, attention remains focused on the release of the FOMC meeting minutes on Wednesday and Fed Chair Jerome Powell's speech at the Jackson Hole Symposium.

From a technical perspective, Friday's breakout above the $2470-2472 resistance area, followed by a subsequent strengthening above the previous all-time high, has been seen as a new trigger for the bulls. Moreover, oscillators on the daily chart remain in positive territory and are far from the overbought zone. This suggests that the path of least resistance for gold is upward. Nevertheless, the failure to sustain momentum above the key $2,500 level warrants caution among bulls. Therefore, before positioning for further gains, it would be prudent to wait for confirmed buying activity beyond Friday's high.

On the other hand, the breakout point at $2,470 serves as support against an immediate decline. Any further downward movement is likely to attract new buyers and remain limited in the $2,446-2,450 zone. This zone is likely to become a key pivot point for short-term traders. A decisive break here could pave the way for deeper losses. Gold could then accelerate its corrective decline towards the 50-day Simple Moving Average (SMA), with some interim support around the $2,400 level.