Gold Price Forecast: XAU/USD approaches $3,700 on Dollar’s weakness

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Gold appreciated for the third consecutive day on Tuesday as the US dollar tanked amid hopes of a dovish turn by the Fed on Wednesday. The US Dollar Index has dropped to fresh two-month lows, which buoys the precious metal to fresh record highs right below $3,700.

Gold resumed its broader bullish trend amid the US Dollar's weakness, to hit fresh all-time highs at $3,700
Hopes that the Fed will accelerate its easing cycle are hammering the US Dollar.
XAU/USD might rally to the $3,740 area before correcting lower.

Recent US data has highlighted a sharp deterioration of the labour market while inflation remains moderate. Speculation that the n¡bank might be behind the curve with rate cuts has boosted hopes that the bank will announce a widely expected quarter-point cut on Wednesday and hint at further easing down the road.

Technical Analysis: Bulls are heading to levels past $3,700

XAU/USD has completed the consolidation phase and is resuming the broader bullish trend. The Relative Strength Index (RSI) is at overbought levels, but bullish momentum remains solid, favoured by the US Dollar’s weakness, with no sign of a trend shift in sight.

Immediate resistance is at the psychological $3,700 level ahead of the 161.8% extension of last week’s rally, near $3,740. A rally to those levels is likely to trigger some bearish correction.

To the downside, immediate support is at the previous $3675 resistance area (September 9 high). A reversal below here would bring the September 11 low, at $3,615, back to the focus, ahead of the September 3 high and September 8 low, at $3,580.

US Dollar Price Today

The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the strongest against the New Zealand Dollar.

	USD	EUR	GBP	JPY	CAD	AUD	NZD	CHF
USD		-0.40%	-0.25%	-0.15%	-0.09%	0.00%	0.03%	-0.43%
EUR	0.40%		0.15%	0.12%	0.30%	0.45%	0.42%	-0.02%
GBP	0.25%	-0.15%		0.02%	0.16%	0.31%	0.28%	-0.18%
JPY	0.15%	-0.12%	-0.02%		0.14%	0.23%	0.01%	-0.22%
CAD	0.09%	-0.30%	-0.16%	-0.14%		0.09%	0.08%	-0.34%
AUD	-0.01%	-0.45%	-0.31%	-0.23%	-0.09%		0.06%	-0.47%
NZD	-0.03%	-0.42%	-0.28%	-0.01%	-0.08%	-0.06%		-0.40%
CHF	0.43%	0.02%	0.18%	0.22%	0.34%	0.47%	0.40%

The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).

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