Caution: Trading involves the possibility of financial loss. Only trade with money that you are prepared to lose, you must recognise that for factors outside your control you may lose all of the money in your trading account. Many forex brokers also hold you liable for losses that exceed your trading capital. So you may stand to lose more money than is in your account. does not guarantee the profitability of trades executed on its systems. We have no knowledge on the level of money you are trading with or the level of risk you are taking with each trade. You must make your own financial decisions, we take no responsibility for money made or lost as a result of using our servers or advice on forex related products on this website.
Expand Offer

Save $228 on our Trade Together program, paid for by our partner.

Learn More

Save $228 on our Trade Together program, paid for by our partner.

Learn More

Gold (XAU/USD) On The Doorstep Of $2,500 

  • 3 mins read ●
  • Published:
gold market analysis 3

Key Points

  • Gold (XAU/USD) is up more than 2% over the past week, posting new all-time highs at $2450. 
  • Geopolitical uncertainty and Fed policy are the two primary market drivers.
  • The key technical level in the XAU/USD is the Daily 38% Fibonacci Retracement ($2405). Above this level, a strong bullish bias is warranted; if it gives way, $2377 is the next premium long entry.

The past five sessions have been active in the gold market. After posting a new all-time high just above $2,450, bullion has entered consolidation between $2,400 and $2,430. With June’s trade rapidly approaching, many metals traders believe a hard test of $2,500 to be inevitable.

Geopolitical Uncertainty

2024 is a year of political and geopolitical uncertainty. Escalations in the Russia/Ukraine and Israel/Hamas wars have boosted investor angst around the globe. In the US, the 2024 Presidential Election cycle is in full swing. Although not yet a premier market driver, the POTUS election is certain to have a significant impact on the gold market.

As a general rule, geopolitical uncertainty leads to bullish gold pricing. Over the past week, the world has witnessed the assassination attempt of Slovakia’s Prime Minister Robert Fico and the death of Iranian President Ebrahim Raisi in a helicopter crash. These two events have contributed to the perception of global unrest; the result has been a seven-day gain in gold of more than 2%. 

The bottom line? Geopolitical tensions continue to be a leading market driver of the bullish gold market.

FOMC Minutes

The number two market driver in the gold market is the monetary policy of the US Federal Reserve. Wednesday, the FOMC Minutes will provide some insight into the inner dialogues of the Federal Open Market Committee (FOMC). 

At this point, the market is pricing in more than a 60% chance of a rate cut in September. However, several FOMC members have made news this week with policy comments. San Francisco Fed President Mary Daly stated that she “is not confident” that inflation is sustainably coming down to the 2% target. Fed Vice Chair Michael Barr stated that Fed policy is in “a good position” to take a wait-and-see approach to inflation; Fed Governor Christopher Waller stated that he needs to see several more months of inflation data before “being comfortable” in supporting easing policy.

Is a hawkish theme emerging from the FOMC? Perhaps. The FOMC Minutes release will give the markets a better understanding of how hawkish or dovish the Fed may be. Signs of conflict in the FOMC boardroom will be the key. Is it time to cut rates? Does holding rates higher for longer bring on a recession? Could an emergency rate hike be in the cards? We’ll soon find out when the FOMC Minutes hits newswires Wednesday at 18:00 GMT.

Daily 38% Fibonacci Retracement Proves Valid

The recent breakout in the XAU/USD has been a beautiful thing for gold bugs. Pullback buys from the Daily 38% Fibonacci retracement ($2405) have been money in the bank.

XAU/USD, Daily Chart

The key level in this market is $2405. As long as bidders defend this area, then a strong bullish bias is warranted. If not, discount buys from the Daily 62% Fibonacci retracement ($2377) will become a premium play. Should bidders send the XAU/USD skyward, shorts from the $2494 area are fantastic bearish scalps.

Overall, it’s a great time to be a gold trader. Geopolitical uncertainty and Fed policy are sure to drive volatility over the near term. Today’s key market driver is the FOMC Minutes; if you’re active in the bullion markets, beware of the release at 18:00 GMT on Wednesday.

Risk Disclosure: The information provided in this article is not intended to give financial advice, recommend investments, guarantee profits, or shield you from losses. Our content is only for informational purposes and to help you understand the risks and complexity of these markets by providing objective analysis. Before trading, carefully consider your experience, financial goals, and risk tolerance. Trading involves significant potential for financial loss and isn't suitable for everyone.

Trade Like a Predator Hunt for Opportunities

Sign up now for FREE access to our exclusive trading strategy videos. Want more? Explore our Trade Together program for live streams, expert coaching and much more.

Here’s what you’ll get:

Identifying high probability scalping setups
When to scalp and when to stay out
Precise entries and exits
Position sizing and risk management
HTT Piranha Strategy Course thumbnail
By clicking the 'Learn Free Now' button you agree to our Terms of Service and Privacy Policy
HTT Connor, arms crossed

In partnership with our recommended partner SwitchMarkets partnering broker logo


1Register with Switch Markets.
2Verify your identity.
3Unlock Trade Together program for free!
Learn More

"Join our Trade Together program and interact with us in real-time as we trade the markets together."

HowToTrade Coaches