Gold Price Today: Early Asian Session Movement
Gold price (XAU/USD) extended its upside momentum during Monday’s early Asian session, climbing above $3,750 per ounce. The move comes after the release of the latest US Personal Consumption Expenditures (PCE) inflation data, which aligned with market expectations. Traders now anticipate further signals from upcoming Federal Reserve (Fed) speeches, which could provide fresh direction for the precious metal.
US PCE Inflation Data in Focus
The US PCE Price Index, considered the Fed’s preferred measure of inflation, rose 2.7% year-on-year in August, up slightly from 2.6% in July, according to the US Bureau of Economic Analysis.
- The figure matched market forecasts, reducing uncertainty about inflationary trends.
- The core PCE index, which excludes food and energy prices, increased 2.9% year-on-year, unchanged from July.
- On a monthly basis, PCE rose 0.3% while core PCE edged higher by 0.2%.
Analysts note that the data strengthens the case for the Fed to continue with its cautious interest rate cut cycle.
Expert Commentary on Fed Rate Cut Outlook
According to metals trader Tai Wong, “Monthly PCE data is in line, though personal income and spending were a tenth above expectations. Nothing from this data will prevent the Fed from carrying on with another cautious rate cut at the October meeting.”
Markets now show:
- 88% probability of a Fed rate cut in October
- 65% chance of another cut in December, based on the CME FedWatch Tool
This growing expectation for lower rates continues to lend support to gold prices, which benefit from a lower opportunity cost compared to yield-bearing assets.
Gold Price Today: Technical Analysis
Bullish Outlook with Caution
Gold is currently trading above its 100-day Exponential Moving Average (EMA), maintaining a strong bullish structure. However, technical indicators also suggest caution:
- The 14-day Relative Strength Index (RSI) stands near 75.90, indicating overbought conditions.
- This suggests that gold may face a period of consolidation or a temporary pullback before resuming its upward trend.
Key Resistance Levels
- $3,800 – $3,810: A crucial resistance zone representing a psychological barrier and the upper band of the Bollinger indicator.
- Sustained trade above this zone could push XAU/USD toward the $3,850 level.
Key Support Levels
- $3,722: Immediate support, marked by the low on September 25.
- $3,632: Stronger downside support, recorded on September 19.
- A close below these levels could invite deeper corrections.
Fed Speeches to Drive Market Sentiment
Traders will closely monitor comments from key Fed officials scheduled to speak later today:
- Christopher Waller (Fed Governor)
- Beth Hammack (Cleveland Fed President)
- Alberto Musalem (St. Louis Fed President)
- John Williams (New York Fed President)
- Raphael Bostic (Atlanta Fed President)
Any hawkish tone suggesting inflation concerns could strengthen the US Dollar (USD), potentially pressuring gold prices. Conversely, a dovish stance would reinforce the bullish case for the yellow metal.
Geopolitical Uncertainty Supports Safe-Haven Demand
Apart from inflation and Fed policy, geopolitical uncertainty continues to support gold as a safe-haven asset. With global tensions and fragile economic growth in several regions, investors seek security in non-yielding assets like gold, especially when monetary easing is on the table.
Daily Market Highlights: Gold’s Upside Momentum
- Gold rose above $3,750 per ounce in the Asian session.
- US PCE inflation 2.7% YoY, matching forecasts.
- Core PCE inflation steady at 2.9% YoY.
- Fed rate cut expectations: October 88%, December 65%.
- Key resistance: $3,800–$3,810.
- Immediate support: $3,722, deeper at $3,632.
Why Gold Prices React to Fed Rate Cuts
The relationship between gold and Fed interest rates is crucial for investors:
- Lower interest rates reduce the appeal of bonds and treasuries, making gold more attractive.
- Weaker US Dollar from dovish Fed policies boosts gold demand globally.
- With inflation steady, the Fed has more flexibility to cut rates without stoking price pressures, which is favorable for gold.
Outlook for Gold Price in Coming Weeks
The near-term outlook for gold prices remains positive, supported by:
- Strong safe-haven demand
- Easing Fed policy expectations
- Technicals favoring an upside bias
However, overbought RSI signals a potential short-term correction. If prices consolidate around current levels, traders may see fresh buying opportunities toward the $3,800–$3,850 range.
Conclusion: Gold Shines Amid Fed Policy Expectations
The gold price rally above $3,750 highlights investors’ confidence that the Fed will continue with rate cuts in 2025, easing financial conditions and supporting demand for precious metals. While technical overbought conditions may cause temporary pullbacks, the long-term bullish outlook for gold remains intact.
Key Takeaways for Investors:
- Gold prices supported by US PCE inflation data in line with forecasts.
- Fed expected to deliver rate cuts in October and possibly December.
- Resistance stands at $3,800–$3,810, support at $3,722.
- Watch Fed officials’ speeches for new cues.
- Overbought RSI signals possible short-term correction.
Gold remains a top-performing safe-haven asset, and investors will continue to track inflation, Fed commentary, and geopolitical risks to gauge the next big move in XAU/USD.
