Gold Price Forecast:

• XAU/USD rose significantly towards the $2,000 level, with a 1.40% recovery.
• US Treasury yields are falling and the Dollar is trading lower, allowing metals to advance.
• The November FOMC Minutes will be closely watched.

In Tuesday’s session, the price of XAU/USD experienced a notable rise, breaking the $2,000 barrier and registering an increase of 1.40%. This notable performance was primarily due to falling US yields, often seen as the opportunity cost of owning non-yielding securities, and the weakness of the US Dollar.

Today’s highlight will be the November minutes of the Federal Open Market Committee (FOMC), due to be released later in the session, with investors looking for more clues on future guidance. For the moment, inflation in the US has shown signs of cooling, as has the labor market, while economic activity has also shown signs of weakening. On the part of the Federal Reserve (Fed), officials maintained a cautious tone, warning that, if necessary, further tightening would be applied.

Along these lines, the bond market could register some volatility if investors detect new clues about the Fed’s next steps. Meanwhile, the yields on the 2.5 and 10-year Treasury bonds fell to 4.86%, 4.40% and 4.39%, which benefited the yellow metal.

XAU/USD Levels to watch

The indicators on the daily chart reflect the dominance of the buying impulse. In particular, the Relative Strength Index (RSI), near overbought conditions, indicates that bullish sentiment is driving the market. This increase in buying pressure is underlined by the Moving Average Convergence Divergence (MACD), which is showing ascending green bars, hinting at increased short-term buying traction.

This is reinforced by XAU/USD placing above the 20,100 and 200-day SMAs, suggesting that buyers have taken control of the broader market outlook.

Support Levels: $1,980, $1,960, $1,935.
Resistance Levels: $2,010, $2,030, $2,050.

XAU/USD Daily Chart