Ouro consolidates gains above US$ 4,427 as the market prices in Fed cuts and geopolitical tensions

Recent movements in the gold price reflect a convergence of macroeconomic and geopolitical factors that continue to benefit this safe-haven asset. During Tuesday’s Asian trading session, the XAU/USD pair advances to levels not seen in seven days, capitalizing on increasing demand for protection against global instability.

Geopolitical scenario intensifies demand for safe assets

The international situation remains marked by multiple points of tension. U.S. military developments in Venezuela, combined with rising friction between Saudi Arabia and the United Arab Emirates, as well as the prolonged instability between Russia and Ukraine, keep investors on alert. These dynamics act as a natural catalyst for gold, which has historically been valued as a safe haven during periods of geopolitical uncertainty.

Dovish expectations from the Federal Reserve weaken the US dollar

Market pricing continues to incorporate the possibility of two interest rate cuts by the Fed in 2024. The mixed PMIs released on Monday—keeping the S&P Global at 51.8 for manufacturing while the ISM drops to 47.9—reinforce narratives of economic slowdown and the need for monetary stimulus.

These prospects weaken the US dollar from its four-week high, directly benefiting gold, which offers no yield and becomes more attractive as the carrying cost decreases. Simultaneously, concerns about the Fed’s independence during the Trump administration amplify this movement.

Technical data suggest continued rise in gold value

From a technical perspective, breaking above the 100-hour Simple Moving Average marks an important inflection point. The MACD shows a positive and slightly ascending histogram on the one-hour chart, with the MACD line marginally above the signal line near zero, indicating reinforced momentum.

The Relative Strength Index (RSI) stands at 68, close to overbought territory, emerging from the intermediate range and signaling strong buying pressure. A penetration above 70 would consolidate the bullish scenario, while a retracement could lead to lateral consolidation.

Technical levels and short-term outlook

Immediate resistance remains in the US$ 4,445-4,450 zone. A sustained breakout above this level could trigger more aggressive movements. Conversely, the dynamic support formed by the 100-hour SMA is at US$ 4,373.28, providing a base for superficial retracements.

The technical context, combined with favorable fundamentals, suggests maintaining the short-term upward trend. Traders await the non-farm employment report (NFP) on Friday as a catalyst to define the next directional move for both the XAU/USD pair and the US dollar in the short term.