The yellow metal consolidates weekly gains with geopolitical support and a dovish scenario from the US central bank

The price of gold (XAU/USD) experiences a new upward momentum on Tuesday, reaching highs not seen in seven days during the Asian session. The quote, trading near US$ 4,428-4,427, benefits from a convergence of factors that reinforce the attractiveness of safe-haven assets, while the Federal Reserve (Fed) remains under pressure to ease monetary policy.

The pillars supporting the recovery of gold prices

The renewed demand for the safe-haven metal is based on three fundamental pillars. First, the escalation of geopolitical tensions remains front and center: U.S. military attacks in Venezuela, the diplomatic dispute between Saudi Arabia and the United Arab Emirates, Iranian instability, and the prolonged Ukrainian war create an environment of uncertainty that naturally favors gold.

Second, the US dollar (USD) retreats from the four-week high zone as traders reaffirm bets on rate cuts by the Fed. U.S. economic data released on Monday reinforce this narrative: while the S&P Global manufacturing PMI remained steady at 51.8, the ISM index contracted to 47.9, signaling cyclical weakness that justifies the central bank’s accommodative stance.

Third, concerns about the Fed’s independence under the Trump administration divert flows away from the US dollar, thus benefiting the metal that does not provide yield. Markets now price in two rate cuts before the end of the year, with the probability of a first reduction in March.

Technical dynamics point to extended gains

From a technical perspective, gold shows signs of considerable strength. The penetration through the night of the 100-hour Simple Moving Average marks an important turning point for XAU/USD buyers. The MACD histogram has turned positive, with the MACD line slightly above the signal line near the zero level, indicating consolidation of the upward momentum.

The Relative Strength Index (RSI) stands at 68, approaching the overbought zone but still offering room for appreciation. A break above 70 would significantly reinforce the bullish scenario, while failure to reach it could lead to a consolidation phase of recent gains.

The 100-hour SMA, located at US$ 4,373.28, acts as a strong dynamic support. As long as the quote remains above this line, any potential pullback should stay superficial, preserving the short-term positive trend.

Weekly outlook: testing US$ 4,445-4,450

The congestion zone between US$ 4,445 and US$ 4,450 emerges as a critical obstacle to overcome for the optimists. A breakout of this barrier would confirm strength and pave the way for further appreciation of gold prices in the coming days.

Traders are closely watching the non-farm payrolls report (NFP) on Friday, an indicator that promises significant directional movement in the pair. This macroeconomic data will provide decisive signals about the expected trajectory for Fed rate cuts, thus boosting the US dollar and determining the next impulse for gold.