Gold Price Prediction: How To Make The Best Investment Decision

 The gold price is currently below the critical zone of $1,800 per ounce, ahead of the Fed meeting minutes. The current environment with high interest rates remains an important bearish factor for the precious metal.

Fundamentals

On the other hand, recent data showed that US consumer prices increased at a lower-than-expected pace in July following a decline in gasoline prices. Yet, the outspoken remarks made by a few Fed officials are impacting the price of gold ahead of the Fed meeting minutes due for release on Wednesday.

Amid the strong US employment market and the lower than expected inflation numbers, bets on the Fed's decision at the September meeting have been ranging between a hike of between 50 or 75 basis points. The minutes of the July meeting are expected to provide additional clues on the US central bank's next move.

Gold price might have reached its near-term low at the low of one year in mid-July when it was $1,681.16. Nonetheless, it may remain under pressure in coming months amid an environment with high interest rates. This is based on the Fed's position that dealing with the decades-high inflation is its first priority.

Seeing that US inflation is expected to continue to rise in the fourth quarter and investors will be watching closely at the data on the economy and its impact on the Fed's path to ease the pressure on prices. To make a move, the bulls will have to build sufficient momentum in order to overcome through the resistance that lies in the psychologically critical zone of $1,800.

Gold price prediction

Gold price edged lower on Tuesday even as it is trading within a tight range ahead of the Fed meeting minutes. Based on its chart for the past four hours, it's under the 25- daily and 50-day exponentially moving averages. Based on these technical indicators, the precious metal will likely remain in a downward trend for the near term.

I expect gold price to remain range-bound as investors await more clues from the Fed minutes of their meeting. Therefore, 1,783.03 is located along the 50-day EMA and will be an important resistance level to keep an eye on for the near-term. As the range-bound trading continues and the bulls focus to defend the current support zone at 1,773.73.

In response on the FOMC minutes, it may pull back further to find the support level at 1,767.53. Notably, this bearish thesis is shattered by a move above 1,791.89 because it will indicate enough momentum for bulls to attempt to break the psychologically crucial area of 1,800.