Gold Price Forecast: XAU/USD points to the upside ahead of Fed minutes

Gold price is treading waters while consolidating Tuesday’s slump as bears take a breather ahead of the critical January Fed meeting’s minutes amid geopolitical tensions. As FXstreet’s Dhwani Mehta notes, gold bulls remain hopeful while above the 38.2% Fibonacci Retracement level (Fibo) at $1,842.

Bullish potential remains intact

“The FOMC minutes could temper the market’s pricing of an anggressive rate hike this year. Any dovish surprise will trigger a fresh selling wave in the US dollar, reviving the demand for gold. However, the incoming Russia-Ukraine developments will be also closely followed for any unexpected market reaction.”

“Gold found support just above $1,842, the 38.2% Fibo level of the rally from January 28 to the three-month top of $1,880. If the 38.2% Fibo support is breached, then a drop towards the confluence of the bullish 21-Daily Moving Average (DMA) and the 50.0% Fibo level at $1,830 cannot be ruled. The 61.8% Fibo level at $1,819 will be the level to beat for gold bears.”

“Bulls are looking to recapture the 23.6% Fibo level at $1,857. The next upside barrier is seen at the previous week’s high of $1,866, above which doors will reopen for a fresh upswing towards the multi-month peak.”

See – Gold Price Forecast: XAU/USD to climb as high as $1,923/1,930 – SocGen