• Gold price struggles to gain traction and is influenced by a combination of diverging forces.
• Hawkish Fed expectations, elevated US bond yields and a bullish USD weighs on the metal.
• Geopolitical risk, along with China’s economic woes, lends some support to the commodity.

Gold price (XAU/USD) is seen oscillating in a narrow trading band during the Asian session on Tuesday and consolidating its losses registered over the past two days, to over a one-week low around the $2,015 area touched the previous day. The mixed fundamental backdrop, however, warrants some caution for bearish traders and before positioning for an extension of last week's retracement slide from the $2,065 region, or a one-month peak.

The US Dollar (USD) stands tall near its highest level in almost three months and remains well supported by expectations that the Federal Reserve (Fed) will keep interest rates higher for longer, bolstered by Friday's upbeat US jobs data. Adding to this, the Institute for Supply Management (ISM) reported on Monday that its Non-Manufacturing PMI increased to 53.4 in January from the 50.5 previous. This, along with hawkish comments by influential FOMC members, further forced investors to scale back their expectations for a more aggressive policy easing by the Fed in 2024