Gold Price Forecast: XAU/USD holds below $2,750, potential downside seems limited

• Gold price loses momentum to around $2,735 in Monday's early Asian session. 
• Geopolitical risks and uncertainty around US presidential elections boost the yellow metal. 
• Bets for a smaller Fed rate cut weigh on the USD-denominated Gold price. 

Gold price (XAU/USD) edges lower to near $2,735, snapping the two-day losing streak during the early Asian session on Monday. However, the downside of the precious metal might be limited amid the ongoing geopolitical tensions and uncertainties surrounding the US presidential election. 

Israeli Prime Minister Benjamin Netanyahu said that Saturday's attack on Iran severely damaged Tehran's defenses. Meanwhile, Iranian officials vowed an "appropriate response" Sunday, while saying they do not seek a wider war, per CNN. The geopolitical risks and uncertainty around the upcoming US presidential election could provide some support to traditional safe-haven assets like Gold. 

The purchases of Gold reserves among central banks and increasing demand from investors have lifted the price of yellow metal. The World Gold Council suggested that the central banks worldwide purchased more than 1,000 tonnes of gold during each of the last two years, and China ranks atop the list of nations seeking to bolster their gold reserves. 

On the other hand, a slower pace of rate reductions from the US Federal Reserve (Fed) amid the stronger US economic data undermines the yellow metal. According to the CME FedWatch tool, traders are now pricing in nearly 97.7% that the Fed will cut rates by 25 basis points (bps) in November.