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Gold price stays under pressure in the early European session on Thursday with limited downside, as investors weigh Fed policy signals against persistent geopolitical risks. The precious metal trades near recent lows, failing to build on Monday’s rebound as the greenback soars to a one-and-a-half-week high.

The US dollar’s strength stems from diminishing expectations of aggressive easing policy. FOMC meeting minutes of July revealed a broad support for keeping the rates steady, as most policymakers anticipate an upside risk in inflation. It shows the central bank is cautious on the rate cuts, drawing flows from non-yielding gold into the dollar.

However, the dollar bulls remain non-committed ahead of economic data, the Fed Chair’s speech, and the Jackson Hole Symposium. The uncertainty around the Fed’s next move has helped the gold buyers as safe-haven demand rises amid cautious market sentiment.

Geopolitical developments also keep the demand for gold underpinned. Russian Foreign Minister Sergey Lavrov said that peace talks with Ukraine without Russia will lead nowhere. Moreover, political tension in the US after President Trump asked for the resignation of Fed Governor Lisa Cook has again raised concerns over the central bank’s independence. Hence, dollar gains remain capped.

Gold’s Key Events to Watch

Looking forward, market participants are eying the US flash PMI data to find signals about economic momentum. Moreover, weekly jobless claims and Philly Fed Manufacturing Index will also provide short-term directional bias.

Gold price technical analysis: Bulls lacking conviction

(Click on image to enlarge)

Gold 4-hour chartgold

The 4-hour chart for gold remains ranging within $3,250 to $3,440, with no apparent technical bias near the mid-$3,300 level. The 20- and 50-period MAs signal a bearish move towards the $3,300 area. The RSI wobbles near the 50.0 level, lacking directional momentum, which suggests the price could keep ranging around current levels.  Breaking the zone could open the door to $3,200. On the upside, the upper range at $3,440 appears as a strong resistance ahead of all-time highs around $3,500.

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