GOLD prices decline on US Dollar strength and Fed tightening

The price of gold has remained low for a second consecutive day, in response to a slight uptick in the US Dollar. The expectation of further policy tightening by the Federal Reserve has bolstered the US Dollar's appeal, causing it to attract buyers on Monday and, consequently, contributing to the decline in gold prices. Market participants now seem to believe that the Fed will continue raising interest rates to combat high inflation in the US, with a 25 basis point increase expected at the next Federal Open Market Committee (FOMC) policy meeting in May already fully priced in. Additionally, the Fed funds futures market indicates a low likelihood of another rate hike in June. From a technical standpoint, the price of gold has slightly rebounded today, but it remains within a bearish continuation pattern. Our analysis suggests an imminent bearish movement for the metal.