August was the best month for gold since April

By RoboForex Analytical Department

Gold (XAUUSD) is holding steady near USD 3,410 per ounce on Friday, just shy of its monthly high, and is set to close its second straight week with gains. The metal is supported by a weaker dollar and consistent safe-haven demand as uncertainty over the Federal Reserve’s policy path lingers.

Dollar weakness and Fed uncertainty support gold

Investors are moving into gold amid concerns that political pressure on the Fed could accelerate the pace of rate cuts. Markets are already pricing in a 25 basis point cut in September. Further support came from Fed Board member Christopher Waller, who said he expects rates to begin falling as early as next month, aligning with other policymakers’ dovish stance.

Attention now turns to the upcoming US household spending report, which is forecast to show stronger growth. This follows revised Q2 GDP data, which revealed slightly higher-than-expected economic expansion. However, concerns about rising inflation are also mounting, keeping gold attractive as a hedge.

Overall, August is shaping up to be gold’s strongest month since April, with prices consolidating at the upper end of the range, underpinned by a mix of dollar weakness and growing economic uncertainty.

Technical analysis of XAUUSD

On the H4 timeframe, gold completed a growth wave to 3,423, marking a local target. A decline towards 3,371 is now in play, with the market continuing to develop a wide consolidation range around this level. A downward breakout would open the way to 3,290, while an upward breakout could extend the range to 3,431 before the downtrend resumes towards 3,290. The MACD indicator supports this view: its signal line is above zero at the highs but has left the histogram zone, a sign of potential weakness and the beginning of a move towards new lows.

On the H1 chart, XAUUSD formed a consolidation range around 3,368 and broke upwards, completing the third growth wave at 3,420. The market has now started a downward correction towards 3,368. After reaching this level, a compact consolidation range is expected. A downward breakout would confirm continuation of the decline to 3,290, while an upward breakout could produce another growth structure towards at least 3,425. The Stochastic oscillator confirms the bearish correction, with its signal line below 50 and heading strictly towards 20.

Summary

Gold is consolidating near highs after its best monthly performance since April. While short-term corrections towards 3,371 and 3,290 remain likely, broader support from a weak dollar, Fed policy uncertainty, and inflation concerns continues to underpin the bullish outlook. Resistance levels are at 3,423–3,431, while support lies at 3,371 and 3,290.