Gold Prices Declines on Eased Mideast Tensions and Dollar Strength

The price of gold extended its significant decline from the previous day, registering its largest daily drop since December 2023. It continued to face selling pressure for the second consecutive day on Tuesday. A decrease in concerns regarding a broader conflict in the Middle East has bolstered a generally positive risk sentiment, leading to a shift away from safe-haven assets like gold. Furthermore, reduced expectations of interest rate cuts by the Federal Reserve (Fed) have contributed to a strengthening of the US dollar (USD), pushing the non-interest-bearing gold price down to its lowest level in over two weeks. With the large intraday loss in XAU/USD, a more severe corrective decline might start. 

The yellow metal is trading at just over the $2300 psychological level. Also, the hourly RSI is in an oversold condition which means a correction could be wait up to the $2314 level. If the $2290 is broken, $2255 is the next Fibonacci support.