Gold Price Forecast: Rise to $2,754 Amid U.S. Election Uncertainty and Fed Meeting

U.S. gold futures rose 0.2% to $2,754.10 as markets reacted to an intense U.S. presidential election, with Republican candidate Donald Trump securing 14 states, while Democratic candidate Kamala Harris captured four states and Washington, D.C., according to projections by Edison Research. However, results from key battleground states remain uncertain and could take hours, or even days, to be finalized.

Amid this election tension, gold is viewed as a safe haven, especially as the potential for economic volatility rises. “Gold is part of the Trump trade and, in the long term, could benefit from a Trump victory,” said Kyle Rodda, financial market analyst at http://Capital.com . He pointed to expectations of larger deficits and unpredictable foreign policies as factors that might drive gold demand under a Trump presidency.

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Fed Meeting Adds to Uncertainty for Gold Traders

The Federal Reserve’s two-day policy meeting, concluding on Thursday, adds another layer of anticipation for gold investors. Many analysts expect the Fed to implement a 0.25% rate cut, building on its September reduction. However, the tone set by Fed Chair Jerome Powell will be closely scrutinized.

Matt Simpson, a senior analyst at City Index, notes, “While markets expect a 25-bp cut this week, the Fed may avoid a dovish tone due to the inflationary impact of Trump’s policies.” For gold, which typically performs well in a low-interest-rate environment, further rate cuts would likely support prices, though the Fed’s approach may be tempered by inflation concerns.

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Gold’s Technical Picture: Key Support and Resistance Levels

In technical terms, gold prices are holding steady within a narrow range. The metal is finding support at $2,731, a level aligned with an upward-sloping trendline that suggests potential bullish resilience. However, resistance looms at $2,750, a barrier reinforced by the 50-period EMA, currently at $2,745, which continues to act as a cap on short-term price gains.

• Immediate Support Levels: $2,731, with additional support at $2,717 and $2,709.
• Immediate Resistance Levels: $2,750, bolstered by the 50 EMA at $2,745.
• RSI: Sitting at 48.9, the Relative Strength Index shows a neutral to slightly bearish outlook, indicating limited momentum in either direction.

Should gold prices break below $2,731, we may see accelerated selling pressure with the potential to test the lower support levels. Conversely, a sustained break above $2,750 could signal a bullish reversal, possibly encouraging further upward momentum.

Conclusion

With the U.S. election outcome and Fed policy decision both in play, gold’s near-term trajectory will depend on these unfolding events. As a hedge against economic uncertainty, gold remains in focus, though technical barriers around $2,750 will need to be cleared for significant gains. Investors should monitor support at $2,731 as well as developments from the Fed and election results for further directional cues.