Fundamental analysis of XAU/USD

Gold (XAU/USD) has recently shown mixed reactions to various global economic factors. Recently, the price of the yellow metal has been near a one-week low and has maintained a downtrend for almost a week. This bearish trajectory is consistent with the US dollar rising to its highest level since mid-March, helped by strong US service sector data for August. The strong data suggests that inflation concerns remain, causing the US Federal Reserve to remain cautious. Boston Fed spokeswoman Susan Collins noted significant progress in fighting inflation, as evidenced by a report that showed economic growth slowed and inflation slowed in July and August. Gold often loses its investment appeal during periods of high U.S. interest rates. While most investors expect the Federal Reserve to leave interest rates unchanged at its next meeting, there is a more than 40% chance of a rate hike before 2024. 
At the same time, the changing economic situation in China is also affecting gold prices. The East Asian giant, one of the main consumers of gold, is transitioning from a traditional infrastructure-based economy to a consumer-oriented economy, which poses many challenges. This transition is reflected in the latest economic data, which showed that China's exports fell 8.8% in August and imports fell 7.3%. Moreover, despite some stimulus measures, growth in China's service sector activity was the slowest in eight months. 
On the other hand, despite the recent pullback, the XAU/USD pair showed some resilience, breaking a three-day decline. Ongoing concerns over China's economic health and ongoing trade tensions between the US and China have played a major role in shifting investor sentiment, making gold a safe haven. Moderate fluctuations in the US dollar exchange rate are also supporting gold, but the outlook for appreciation remains uncertain. At the same time, tightening policy expectations from the Fed coupled with positive macroeconomic data from the US could contain any significant dollar depreciation and thus limit XAU/USD's upside. 
Fundamental conditions suggest that investors remain cautious and keep an eye on any significant gold buying trends to determine its future trajectory. For short-term updates on the state of the economy, the weekly US jobless claims data should be looked at.
Technical Analysis and Scenarios:

The Alligator indicator is currently pointing to bearish momentum as evidenced by its hungry posture. The blue line (jaw) is well above the green and red lines, indicating that the market is currently in a downtrend. Both oscillators are in the gray zone, showing divergence. This signals possible indecision in the market and suggests that traders should be cautious before making any trades as there is no clear direction. Given the current downtrend indicated by the Alligator and the fact that the XAU/USD pair is trading near the first support level, there is a possibility that the price will continue to move downwards.
Main scenario (SELL)
Recommended entry level : 1915.00.
Take Profit: 1905.00.
Stop Loss: 1920.00.
 
Alternative scenario (BUY)
Recommended entry level: 1931.00.
Take profit: 1938.00.
Stop loss: 1927.00.