Gold price holds steady above short-term range support, bullish potential seems intact

• Gold price struggles to gain any meaningful traction and remains confined in a familiar range.
• Reduced bets for a 50 bps Fed rate cut in November act as a headwind for the precious metal.
• Geopolitical risks and a modest USD downtick should limit any further losses for the XAU/USD. 

Gold price (XAU/USD) remains depressed during the Asian session on Tuesday and is currently placed just above the lower boundary of a short-term range. Investors have been scaling back expectations of another oversized interest rate cut by the Federal Reserve (Fed) in November amid signs of still resilient US labor markets. This, in turn, is seen as a key factor acting as a headwind for the non-yielding yellow metal.

Meanwhile, the US Dollar (USD) pulled back from a seven-week high touched on Friday as traders opt to move to the sidelines ahead of the release of the FOMC meeting minutes on Wednesday. Apart from this, the US Consumer Price Index (CPI) and the Producer Price Index (PPI) on Thursday and Friday, respectively, will influence expectations about the Fed's rate-cut path. This will provide a fresh impetus to the USD and the Gold price. 

In the meantime, geopolitical risks stemming from the ongoing conflicts in the Middle East should act as a tailwind for the safe haven Gold price and help limit any meaningful downfall. This, in turn, makes it prudent to wait for a sustained breakdown below a one-week-old trading range support before positioning for an extension of the XAU/USD's recent pullback from the all-time peak touched on September 26. 

Daily Digest Market Movers: Gold price extends the range play amid mixed fundamental cues

• The upbeat US jobs report for September released on Friday prompts traders to pare bets for a more aggressive policy easing by the Federal Reserve and undermines the Gold price. 
• According to CME's FedWatch tool, market participants are currently pricing in an 85% chance of a 25 basis points rate cut at the next FOMC monetary policy meeting in November. 
• The yield on the benchmark 10-year US government bond moved past the 4% threshold for the first time in two months, while the US Dollar moved away from a seven-week high.
• Minneapolis Fed President Neel Kashkari noted on Monday that the overall balance of risks has now shifted away from higher inflation, towards maybe higher unemployment.
• Separately, St. Louis Fed President Alberto Musalem said that he supports additional interest rate cuts and that the economic performance will determine the path of monetary policy.
• Hezbollah fired rockets at Israel's port city of Haifa and a military base near the central city of Tel Aviv, while Israel bombed a couple of buildings in the southern suburbs of Beirut.
• Investors remain concerned that Middle East tensions could turn into a wider conflict, which might act as a tailwind for the safe-haven XAU/USD and help limit deeper losses. 
• China's state planner - the National Development and Reform Commission (NDRC) - said this Tuesday that the downward pressure on China's economy is increasing. 
• Traders now look to the release of the FOMC meeting minutes on Wednesday, which will be followed by the latest US inflation figures on Thursday and Friday, respectively. 

Technical Outlook: Gold price bulls have the upper hand while above 2,632-2,630 pivotal support

From a technical perspective, the $2,632-2,630 area, or the lower boundary of a short-term trading range, might continue to protect the immediate downside. A convincing break below might prompt some technical selling and drag the XAU/USD below the $2,600 mark, towards the next relevant support near the $2,560 zone. The corrective decline could extend further towards the next relevant support near the $2,535-2,530 region en route to the $2,500 psychological mark.

Meanwhile, oscillators on the daily chart are holding in positive territory and favor bullish traders. That said, the $2,670-$2,672 area might continue to act as an immediate barrier. This is followed by the $2,685-2,686 zone or the all-time high touched in September, and the $2,700 mark, which if cleared will be seen as a fresh trigger for bulls and set the stage for an extension of a well-established multi-month-old uptrend.