XAU/USD is consolidating ahead of a sustained break above $2,530

• The price of gold is bucking a three-day uptrend Wednesday morning, just below $2,530.
• The US dollar is trying to recover amid a risk-on mood as Treasury yields remain sluggish.
• Gold traders turn cautious ahead of Fedspeak and Nvidia earnings report.
• The daily technical configuration of the gold price indicates a new life level in the making.

The price of gold has returned to the red, but remains in its familiar range this week, above $2,500 on Wednesday morning. The price of gold is repeating the negative action seen during the Asian session on Tuesday, awaiting speeches from policymakers from the US Federal Reserve (Fed) for further clues on the interest rate outlook.

Gold price awaits Fedspeak for new boost

Moreover, a sense of caution prevails as markets remain cautious amid geopolitical risks in the Middle East looming ahead of Nvidia’s highly anticipated earnings later this Wednesday and Friday on US inflation.

Amid a risk-on state, the US dollar (USD) is finding fresh demand, which is acting as a position for gold prices. However, sluggish U.S. Treasury bond yields could limit the U.S. dollar’s gains, dampening the fall in gold prices.

Meanwhile, dovish Fed expectations and geopolitical tensions in the Middle East will continue to support gold prices. White House spokesman John Kirby said on Tuesday that the US believes Iran is ready to launch an attack on Israel.

In addition, the Israeli army mobilized thousands of special forces soldiers in preparation for the large-scale operation in the northern West Bank, which lasted a long time.

Despite the bullish sentiment around the gold price, the upcoming Fedspeak will provide new trading impetus to the gold price. Markets are currently pricing in a 32% chance of a 50 basis point (bps) rate cut in September, while the odds of a 25bps cut are 68%, CME Group’s FedWatch tool showed on Wednesday .

On Tuesday, the price of gold witnessed a good two-way price movement, initially correcting slightly from near the record high of $2,532, based on the safe haven demand for the US dollar. However, the greenback came under intense selling pressure in sync with US Treasury bond yields following the results of a strong US 2-year auction following the $69 billion selloff.

The USD failed to find any inspiration from an improvement in US Conference Board (CB) consumer confidence data and a tech sell-off in US and Chinese stocks.

Gold Price Technical Analysis: Daily Chart

Nothing has changed for the price of gold from a short-term technical perspective, with upside risks intact as long as buyers defend the triangular resistance turned support at $2,466.

The 21-day simple moving average (SMA) is approaching this level, making it a strong support.

It is worth noting that the price of gold is consolidating its top break from a symmetrical triangle confirmed a few weeks ago.

Meanwhile, the 14-day Relative Strength Index (RSI) is falling but holding comfortably above 50, currently near 61, justifying the bullish outlook.

Gold buyers need to recover the record level of $2,532 to face the next key barrier at the $2,550 level.

Acceptance above the latter could challenge the round level of $2,600 en route to the triangle target measured at $2,660.

On the other hand, the initial demand area is seen at the $2,500 threshold for gold buyers, below which Friday’s low of $2,485 will be challenged.

A sustained breach of the latter could expose downside to the aforementioned triangle resistance turned support at $2,466.