Market Analysis

Gold prices (XAU/USD) surged to a fresh all-time high, reaching around $2,300 during the Asian trading session on Thursday. The rally is supported by a blend of factors, including ongoing geopolitical tensions stemming from the Russia-Ukraine conflict and Middle Eastern unrest. 

Additionally, a recent devastating earthquake in Taiwan has bolstered demand for the safe-haven metal.

The steep decline in the US Dollar (USD) this week, following uncertainties surrounding the Federal Reserve's interest rate policies, further reinforces the positive sentiment surrounding gold in the near term. However, despite these supportive factors, a cautious tone persists due to the equity markets' generally positive performance and the overextended conditions observed on the daily chart.

Technical indicators, notably the Relative Strength Index (RSI), signal that gold prices are currently overbought, suggesting the need for consolidation or a minor pullback before considering further upward moves. 

Support levels are anticipated around $2,280 and $2,265, with a breach potentially leading to a deeper decline towards the $2,229-2,228 range. Breaking decisively below this level could expose the psychological support at $2,200.

Market participants are closely monitoring influential Federal Open Market Committee (FOMC) member speeches for short-term trading opportunities ahead of the release of the Nonfarm Payrolls (NFP) report on Friday, which is expected to provide further insights into the US labor market and potentially impact gold prices.

Paraphrasing text from "FX Street" all rights reserved by the original author.