Gold Price Tumbles Below $4,320 as US Dollar Index Consolidates Above 100.00

Gold (XAU/USD) fell for the second consecutive day on Tuesday, reaching levels below $4,320 during the European session. The precious metal's recovery attempt from last week's low stalled at $4,400.

The US Dollar Index (DXY) consolidated above the key 100.00 level, buoyed by rising bets of Federal Reserve interest rate hikes. Boston Fed President Susan Collins and St. Louis Fed President Alberto Musalem endorsed hopes of further monetary tightening by the US central bank.

Technical analysis suggests that XAU/USD is hovering above the neckline of a bearish Head & Shoulders pattern, with momentum conditions reinforcing the soft bias. The Relative Strength Index (14) remains below 50, and the Moving Average Convergence Divergence (MACD) indicator stays in negative territory.

Bulls would need to break the intra-week highs at $4,399 and the September 3 high at $4,510 to shift the focus towards August's peak of around $4,700. On the downside, a confirmation below the $4,230 area, where the August 7 and September 16 lows meet the H&S neckline, brings the $4,000 psychological area into focus.