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Gold (XAUUSD) is gaining strength as markets grow confident in upcoming Federal Reserve rate cuts. Softer inflation data has reinforced expectations of policy easing. Meanwhile, political uncertainty and renewed geopolitical tensions continue to support safe-haven demand. At the technical level, gold has broken out of a prolonged consolidation phase, signaling bullish momentum. Overall, with price action holding above key resistance, both macro and technical factors now align in favor of further upside.  

Gold Rises on Cooling Inflation and Growing Fed Rate Cut Bets
 

The recent surge in gold prices highlights market expectations for Federal Reserve rate cuts. Core inflation remains soft, giving the Fed more room to cut rates. Core PCE rose 0.3% in July, with annual inflation steady at 2.9%, near the Fed’s preferred range. As a result, market expectations for rate cuts in the near term have strengthened.

Meanwhile, political tensions are drawing renewed attention in financial markets. Trump’s strategy to make dovish appointments to the Fed could weaken the central bank’s independence. As a result, the Dollar comes under pressure, boosting safe-haven interest in gold. Concerns over institutional credibility continue to increase gold’s safe-haven appeal.

In a parallel development, Ukraine is advancing plans to target deeper regions within Russia. This development heightens geopolitical risk and fuels demand for safe havens. Zelenskiy’s remarks indicate a possible turning point in the war. In response, gold extended its rally, climbing close to 6% in the last two weeks. Despite a modest rebound in the Dollar, gold continues to draw support from broader macroeconomic factors.

Gold Breaks Key Resistance After Prolonged Range Consolidation
 

The gold chart below shows a well-formed consolidation phase just below key resistance. Recently, the price has broken out of a prolonged consolidation range that had formed just below the $3,500 level, which acted as a key resistance zone. This horizontal resistance has been tested multiple times since April, as marked by the red circles. However, each attempt resulted in a pullback, keeping gold in a state of compression and signaling heavy selling pressure above the range.
 

Overall, the price structure indicates that the market is positioning for a breakout. Specifically, the range between $3,300 and $3,500 formed a clear rectangle pattern. Historically, a narrow consolidation phase often precedes a sharp breakout. Gold has broken through the upper boundary of the range, closing firmly at $3,495.88. This move suggests bullish momentum is building as market conditions support further gains.

Notably, gold continues to follow a well-established rising long-term trendline. This trendline has consistently served as a base for renewed buying interest after each correction. The breakout has opened the door for a potential move toward the $3,550–$3,600 area. Furthermore, a clear move above that level could open the door to new highs, though strong U.S. data might trigger a pullback into the prior range. In that case, $3,410 and $3,360 become key support levels. The overall structure resembles a bullish continuation pattern. If resistance is cleared, a new leg higher may follow.

Gold Outlook: Price Clears Key Resistance as Macro Forces Turn Supportive
 

Gold remains well-positioned as macro and geopolitical factors continue to support the bullish outlook. Easing inflation and rising expectations of Fed rate cuts have strengthened the case for further gains. At the same time, political instability and global conflict are driving safe-haven demand. The recent breakout above key resistance confirms growing momentum. If momentum persists above the breakout point, gold could rally toward the $3,550–$3,600 range.

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