XAUUSD is losing ground: US inflation and the Middle East are weighing on the gold market

Gold continues to fall, approaching the March lows amid geopolitical tensions. Prices currently stand at 4,372 USD. Discover more in our analysis for 28 May 2026.

XAUUSD forecast: key takeaways

• Core PCE price index: previously at 3.2%, projected at 3.3%
• The market has shifted its focus to the Fed's rate review
• XAUUSD forecast for 28 May 2026: 4,320

Fundamental analysis

The XAUUSD price forecast for today, 28 May 2026, shows that gold continues its downward trajectory this week, testing the March lows. At this stage, XAUUSD quotes have broken below the psychological 4,400 USD level and are trading around 4,372 USD per ounce.

The decline is primarily driven by the renewed geopolitical tensions between the US and Iran, which, contrary to the logic of traditional safe-haven markets, is putting pressure on gold. The US President stated that he would not rush to conclude a deal, while the White House denied Iranian media reports of an alleged agreement. Secretary of State Marco Rubio threatened to respond differently if no good deal with Iran is reached.

The market has shifted its focus to reassessing Fed rates, which has been a major boost for the dollar and a blow to non-yielding gold. At this stage, traders estimate the likelihood of a Federal Reserve rate hike by the end of the year at almost 50%, and as high as 60% in January 2027.

The key event of the day will be the release of the core PCE index, the Fed’s preferred inflation gauge. The forecast suggests growth to 3.3%, which could become a new high since 2023 and increase pressure.

The core PCE price index is a key US inflation indicator, tracking price changes in goods and services, excluding food and energy. The core PCE reflects the population’s real purchasing power and the level of economic stability, as it is less susceptible to short-term fluctuations.

The forecast for 28 May 2026 takes into account that the index may rise to 3.3%, up from the previous reading of 3.2%; if the actual figure exceeds the forecast, this will be a new high since 2023.

The escalation of the conflict in the Middle East is pushing oil prices and the dollar higher, while inflation expectations are forcing the Federal Reserve to maintain a hawkish stance, which is dampening demand for the non-yielding metal.

Technical outlook

On the H4 chart, XAUUSD prices have formed a Harami reversal pattern near the upper Bollinger Band and could continue the downward wave following the pattern signal. Since XAUUSD quotes have broken out of an ascending channel, the downside target could be the 4,320 USD support level.

At the same time, today’s XAUUSD technical analysis also suggests another market scenario, with prices correcting towards 4,510 USD before a further decline.

XAUUSD overview

• Asset: XAUUSD
• Timeframe: H4 (Intraday)
• Trend: downward
• Key resistance levels: 4,510 and 4,575
• Key support levels: 4,320 and 4,252

XAUUSD trading scenarios for today

Main scenario (Sell Stop)

A breakout below the support level, with quotes consolidating below 4,320 USD, would confirm a bearish wave.

• Take Profit: 4,252
• Stop Loss: 4,350

Alternative scenario (Buy Stop)

A return to the ascending channel, with quotes consolidating above 4,510 USD, would increase buying pressure and trigger an upward wave.

• Take Profit: 4,575
• Stop Loss: 4,480

Risk factors

The main risk for the bears remains the release of the PCE data. If inflation comes in below forecasts, this will weaken expectations for Federal Reserve rates and bring buyers back to the gold market. From a technical perspective, consolidation above 4,510 USD will invalidate the downside scenario for XAUUSD and resume the bullish correction.

Summary

After breaking below the psychological 4,400 USD mark, gold continues to decline. XAUUSD technical analysis suggests a fall towards the 4,320 USD support level.

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