gold remained near its record highs early Monday, with prices hovering around $3,700. The precious metal continues to attract investor interest, building upon a strong rally that has seen it post five consecutive weekly gains. This momentum persists despite a recovery in the US dollar, which has been supported by recent US economic data and a less dovish stance from the Federal Reserve.
The dollar’s strength has kept the market’s attention centered on upcoming Federal Reserve communications and economic indicators. Traders are closely watching speeches from Fed officials for guidance on future monetary policy, especially as the market anticipates a key inflation report — the core Personal Consumption Expenditure Price Index — is scheduled for release later in the week. The report is expected to influence the Fed’s outlook and potential interest rate adjustments. Meanwhile, market participants remain cautious ahead of the scheduled Treasury auctions, which could also sway dollar movements and, consequently, gold prices.
Technical analysis suggests that gold ’s bullish momentum remains intact. The daily Relative Strength Index, a momentum indicator, currently sits just above 70, signaling that the market is overbought but still with room to rise. If the buying pressure continues, gold is poised to test the recent high of around $3,708. A daily close above this level could open the way toward $3,750, while a decline below $3,650 might see the price retest support levels around $3,627 or even dip further toward $3,600.
The broader economic environment continues to influence gold ’s prospects. The Federal Reserve’s monetary policy — employing interest rate adjustments and asset purchase programs — remains a key driver. These tools influence inflation, debt yields, and the U.S. dollar’s strength, all of which have direct implications for gold . As traders await further economic data and Fed signals, gold ’s path remains closely aligned with the evolving landscape of U.S. monetary policy and global economic developments.
