XAU/USD trading as we know it today took shape in the 1970s and 1980s when gold started to be actively traded as a financial asset. Gold futures contracts were introduced, allowing traders to speculate on the future price of this metal. The development of electronic trading platforms further facilitated the trading of XAU/USD. Here are some crucial points of the XAU/USD price history:

Until 2011, the price was moving in a strong uptrend. After a consolidation, the price moved down in 2013, so a downtrend prevailed in the market until the beginning of 2016.

In early 2016, gold prices were trading around $1,050 per troy ounce. This period marked the end of a multi-year downtrend. Factors such as concerns about global economic growth, central bank policies (including low interest rates and quantitative easing), and geopolitical tensions contributed to increased demand for gold as a so-called safe-haven asset.

By September 2017, the gold price reached around $1,300 per ounce. Geopolitical tensions, including North Korea's nuclear tests and a weaker US dollar, were some of the drivers behind this rise.

Gold prices faced headwinds in 2018, as the US Federal Reserve was raising interest rates, making the US dollar stronger. In 2019, it regained its strength driven by concerns over a global economic slowdown, trade tensions between the US and China, and central banks around the world adopting more dovish monetary policies. By September 2019, gold prices had surged above $1,500 per ounce.

Gold experienced significant price movements in 2020 due to the outbreak of the COVID-19 pandemic. As global markets experienced extreme volatility and uncertainty, investors turned to gold as it’s believed to be a safe-haven asset. Gold prices hit a new high in August 2020, surpassing $2,000 per troy ounce. The weakening US dollar and unprecedented stimulus measures by central banks also contributed to this surge. Gold managed to keep its strong position against the USD until the middle of 2023.

The major factor that affects the pair is the physical supply and demand for gold, including factors like mining production and jewellery sales. However, these factors often have a more gradual and long-term impact.

If you consider short-term XAU/USD forecasts, you can pay attention to the strength or weakness of the US dollar. When the USD strengthens, the price of gold, which is denominated in dollars, tends to fall, and vice versa. The dollar's strength can be influenced by economic data, interest rates, and monetary policy.

Economic conditions, both in the United States and globally, play a significant role in XAU/USD price movements. Economic data such as GDP growth, unemployment rates, and consumer sentiment can impact investor sentiment and the demand for gold as a so-called safe-haven asset.

Political instability, conflicts, and trade tensions can lead to increased demand for gold as market participants believe it to be a safe-haven asset. Geopolitical events often lead investors to seek assets that are considered less risky, which can drive up the price of gold.

Gold is often used for hedging against inflation. When there are concerns about rising inflation, investors may turn to gold to protect their purchasing power, causing gold prices to rise.

The prices of other commodities, such as oil and industrial metals, can also affect the XAU/USD pair. Gold often moves in the opposite direction of commodities that are heavily used in manufacturing and construction.