Gold Price Forecast: XAU/USD holds positive ground above $1,950, eyes on US UoM data

• Gold price gains ground around $1,958 despite the firmer USD.
• Hawkish comments from Federal Reserve (Fed) Chair Jerome Powell boost the US Dollar and US Treasury bond yields.
• The escalating tensions in the Middle East might cap gold's downside.
• Gold traders will monitor the US University of Michigan Consumer Sentiment survey for fresh impetus.

Gold price (XAU/USD) snaps the three-day losing streak during the early Asian session on Friday. The rise of geopolitical tension in the Middle East lifts safe-haven assets like gold, despite the higher US Treasury bond yields. The gold price currently trades around $1,958, gaining 0.03% on the day.

Meanwhile, the US Dollar Index (DXY) surges to 105.90 following the hawkish comments from Federal Reserve (Fed) Chairman Jerome Powell. The US Treasury bond yields also edge higher, with the 10-year yield staying at 4.65% and the 2-year yield reaching 5%.

Late Thursday, Fed Chair Jerome Powell said they are not confident that they have achieved a sufficiently restrictive policy to bring inflation down to 2 percent over time. Powell further stated that if it’s appropriate to tighten policy further, the Fed will not hesitate. However, the Fed does not make a decision now about a significant bond tightening, but it is not going to ignore it. That being said, the hawkish comments from Fed Powell might boost the US Dollar (USD) and cap the upside of the Dollar-denominated gold.

On the other hand, the elevated geopolitical risks in the Middle East might lift the safe-haven gold. The White House said on Thursday that Israel has agreed to halt military operations in parts of north Gaza for four hours each day, but there was little evidence of a lull in the war.

Investors will keep an eye on the Fed's Logan speech, the preliminary US Michigan Consumer Sentiment Index for November, and UoM 5-year Consumer Inflation Expectation. These events could give a clear direction to gold price.