Gold Price Forecast: XAU/USD points to deeper losses towards $1,700

Gold remains on the back foot, changing hands at around $1,750. FXStreet’s Dhwani Mehta explains why XAU/USD appears vulnerable as focus shifts to FOMC.

The path of least resistance for gold appears to the downside

“The Federal Reserve is likely to announce its tapering plans, starting by the end of this year, at its September 21-22 monetary policy meeting. The Bank of England may also hint at tapering, given the rising inflation in the UK. A potential withdrawal in the monetary policy stimulus will continue to bode ill for gold.”

“A failure to defend the monthly lows of $1742, a fresh leg down could initiate towards the $1700 psychological magnate. Alternatively, the pattern support now resistance at $1753 could challenge gold’s road to recovery.”