Gold prices (XAU/USD) weakened slightly in the Asian session on Monday, after previously breaking a new record. This weakening occurred as market participants began taking profits ahead of the year-end holidays, when market liquidity was thin.

Gold briefly touched a record high of around $4,550 per ounce, but then corrected. In addition to profit-taking, a strengthening US dollar could also pressure gold by making it more expensive for buyers outside the US.

Despite the short-term decline, the broader trend remains strong. Gold has surged nearly 70% through 2025, its best annual performance since 1979.

Gold's downside potential is considered limited as the market still expects a Fed rate cut in 2026. Lower interest rates typically support gold, as the opportunity cost of holding a non-yielding asset like bullion is reduced.

Geopolitical factors also remain a key factor. US President Donald Trump said there has been "a lot of progress" in peace talks with Ukrainian President Volodymyr Zelensky, but there has been no breakthrough on the crucial issue of territory, and the process could take several weeks.

From US economic data, weekly initial jobless claims for the period ending December 20 fell to 214,000 from 224,000, better than the market forecast of 223,000. For today's agenda, the market also awaits the release of US Pending Home Sales for November.

Technically, gold remains bullish, but there are signs the market is starting to overheat. The 14-day Relative Strength Index (RSI) is above 70, indicating overbought conditions, so a consolidation phase is reasonable. The $4,550 level is the closest resistance; if it breaks decisively, the next target could be $4,600. Meanwhile, initial support is at $4,430, followed by $4,338, and then $4,300 if selling pressure continues. (asd)

Source: Newsmaker.id