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Gold prices are consolidating near record highs above the $2,600 mark after hitting a fresh peak earlier this week. The bullish momentum is supported by market bets on further rate cuts from the Federal Reserve, which have weakened the US Dollar. Geopolitical tensions, particularly in the Middle East, along with US political uncertainty, are also driving safe-haven demand for gold. However, overbought technical conditions and anticipation of the US Personal Consumption Expenditures (PCE) Price Index report are keeping traders cautious. Key support levels are around $2,560, while resistance remains at the $2,600 mark, with further direction dependent on upcoming economic data and geopolitical developments.

Key Highlights

* Gold price consolidates above $2,600 after hitting an all-time high on Monday.

* Fed rate cut expectations and geopolitical risks support the bullish outlook for gold.

* Traders await the US PCE Price Index for further market direction.

* Overbought conditions prompt caution as gold holds steady near recent peaks.

* Support levels sit at $2,560, with $2,500 as a psychological key point.

Gold prices have stabilized above the $2,600 mark after reaching a new all-time high earlier this week. The recent rise in gold has been largely driven by growing market bets that the Federal Reserve will continue to lower interest rates in response to a weakening US labor market and a softening economy. Additionally, heightened geopolitical tensions in the Middle East and upcoming US elections are further strengthening the appeal of gold as a safe-haven asset. Despite these factors, gold's upward momentum has cooled slightly due to overbought conditions on the daily chart, prompting traders to remain cautious.

Supporting this consolidation, traders are now focused on the upcoming US Personal Consumption Expenditures (PCE) Price Index report, which could further clarify the Fed's future rate policy. The recent 50 basis point rate cut by the Fed has already pressured the US Dollar, which briefly recovered from its year-to-date low before retreating again. Additional commentary from Federal Reserve officials suggests that more rate cuts are likely in the coming months, which should continue to support gold's price.

Other news impacting the gold market includes ongoing conflicts in the Middle East, particularly the rising death toll from Israeli airstrikes in Lebanon, which has increased fears of broader regional conflict. Despite global economic concerns and US political uncertainty, the broader bullish sentiment for gold remains intact, though traders may await clearer signals before pushing prices higher.

Finally

Gold's price is likely to hold above $2,600, with key support around $2,560. Traders will watch for PCE data and geopolitical developments for further direction.

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