On Friday, spot gold continued to fall, dropping more than 2% within the day and falling below the $2400 mark before rebounding slightly to $2404. Some analysts believe that the reason for this pullback in gold is that some investors have started to take profits.

OANDA market analyst Zain Vawda said, "This seems to be the result of multiple factors, including a stronger US dollar, rising US Treasury yields, easing geopolitical tensions, and potential profit-taking. All of these factors have led to gold softening before the weekend. If the gold price closes below $2,400 today, reaching $2,500 in the short term may be a challenge."

According to the Federal Reserve observation tool of CME Group, the market expects a 98% chance of a Fed rate cut in September. In a low interest rate environment, the appeal of non-yielding gold is often greater.

Earlier this week, Federal Reserve Chairman Powell said that recent inflation data "somewhat reinforced people's confidence" that inflation growth is returning sustainably to the Fed's 2% target.

Ricardo Evangelista, a senior analyst at ActivTrades, predicts that the support level of $2,400 for gold will come into play, and gold prices should rebound above this level in the short term.

Evangelista said that another factor that may affect the gold price is that traders believe that Trump will win the November election, and with it more protectionist global affairs and trade positions. He said, "This is very good for the US dollar and will of course also affect the gold price."

Earlier, Capital Economics released a report stating that the recent peak in gold represents the top of the year and expects gold to fall towards $2,200. This prediction is based on the belief that high prices will suppress retail demand in key global markets, with a particular focus on China. High gold prices may prevent consumers from maintaining the positive buying pace seen in the first half of the year.

Editor/ping