Investors' focus will be on the FOMC meeting by the Federal Reserve (Fed) on Thursday which will determine the current interest rate in the United States (US).
The rate will affect the strength of the US dollar currency for a long period of time, becoming an important indicator for investors in the market.
The interest rate cut will give gold an advantage to reach a higher price level, but investors are still evaluating the expected cut in the number of basis points that the Fed will make.
If the Fed cuts interest rates by 50 basis points, investors expect prices to react more aggressively.
While the focus is on the FOMC, investors are also looking ahead to US retail sales data to be released tonight (Tuesday) which provides a general picture of US consumer spending.
On the XAU/USD chart which measures the value of gold against the US dollar, on Monday the price dropped at the opening of the New York session from a price level around 2589.00 before dropping to 2576.00.
For prices to continue the momentum of last week's surge, investors expect the 2600.00 level as a target for higher gains.
However, if the price shows a bearish movement, investors will expect the price to be able to reach around the 2500.00 zone, but need to pass the 2530.00 zone first.
