XAU/USD. Analysis and Forecast

Ben Graham · February 18

Gold is showing moderate intraday gains, recovering a significant portion of Tuesday's losses. However, the fundamental backdrop encourages bulls to remain cautious ahead of the FOMC minutes, which are expected to clarify the pace of interest rate cuts by the U.S. Federal Reserve. This will significantly influence the short-term trajectory of the U.S. dollar and provide new momentum for the precious metal.

On Tuesday, Austan Goolsbee, President of the Federal Reserve Bank of Chicago, stated that there could potentially be several more rate cuts this year. His remarks came against the backdrop of weaker U.S. consumer inflation data released last Friday and expectations of a Fed rate cut in June, plus two additional cuts in 2026. This environment continues to support demand for gold.

Despite the dovish outlook, the U.S. dollar retains a moderately positive tone, which, together with easing geopolitical risks, may slow the rally in the safe-haven asset. U.S.–Iran negotiations have resumed: during the second round of nuclear talks in Geneva, the sides agreed on key "guiding principles," reducing fears of escalation. A trilateral meeting between the U.S., Russia, and Ukraine, as well as peace negotiations, has been postponed to Wednesday. Nevertheless, optimism in equity markets sustains buying interest, making it prudent to wait for stronger follow-through before positioning for further upside in XAU/USD.

Market focus will next shift to U.S. housing data, comments from Federal Reserve officials, fourth-quarter 2025 GDP figures, and the Fed's key inflation gauge—the core Personal Consumption Expenditures (PCE) index.

From a technical perspective, gold is finding solid support at the 200-period simple moving average (SMA) on the 4-hour chart and remains above the rising SMA, preserving the broader uptrend. This SMA is acting as strong support. Despite the favorable long-term slope, additional momentum is required to confirm bullish continuation.

The MACD histogram remains below zero, though the negative bars are narrowing, signaling weakening bearish pressure. The Relative Strength Index (RSI) stands at 43.46—below 50—indicating moderate seller dominance. A rebound from the rising SMA would maintain the prevailing trend structure, while a drop below this level risks triggering further downside. A break of the RSI above 50 would revive short-term bullish sentiment and bring buyers back into the market.

It is worth noting, however, that on the daily chart oscillators remain positive, confirming that, on a broader scale, bulls have not given up.

The table below shows the percentage change of the U.S. dollar against major currencies for the day. The U.S. dollar demonstrated strength against the New Zealand dollar.