Gold prices held steady above the $3,200 mark on Monday after briefly touching an all-time high of $3,245 at the weekly open. Although the precious metal experienced slight profit-taking, the ongoing trade tensions between the United States and China, coupled with expectations of Federal Reserve rate cuts, continue to support the bullish momentum in XAU/USD.
🟡 Gold Technical Outlook: Key Levels to Watch
At the time of writing, gold (XAU/USD) is trading near $3,225, entering a short-term consolidation phase. The Relative Strength Index (RSI) on the daily chart is hovering just above 70, indicating overbought conditions that may trigger a minor pullback.
- Immediate support lies at the $3,200 psychological level.
- A deeper correction could test the $3,167-$3,168 zone, seen as a critical short-term pivot.
- On the upside, $3,250 remains the next key resistance.
- A breakout above that level could open the doors to a run toward $3,300 and beyond.
🔍 Technical bias: Bullish above $3,200; short-term consolidation likely before next leg higher.
📰 Fundamental Drivers: Fed Rate Cut Bets and Trade War Uncertainty
Gold’s upward trajectory has been driven by a combination of safe-haven demand, a weakening US Dollar, and escalating concerns over the US-China trade war. Although the initial panic has somewhat eased, the threat of prolonged tariff battles keeps investors wary, offering consistent support to gold prices.
Additionally, markets are increasingly pricing in multiple interest rate cuts by the Federal Reserve this year, possibly starting as early as May. Lower interest rates reduce the opportunity cost of holding non-yielding assets like gold, boosting its appeal.
- US Dollar Index (DXY) remains near multi-year lows.
- Equity markets are showing signs of recovery, which may limit gold’s upside in the short term.
- Traders expect 3 or more Fed rate cuts in 2025 due to soft inflation data and trade-related economic risks.
📊 Summary: Gold’s Consolidation Is a Pause, Not a Reversal
While gold has eased slightly from its record peak, the fundamental backdrop remains firmly supportive. Any pullbacks toward the $3,200 level are likely to be viewed as fresh buying opportunities, especially amid global macroeconomic uncertainty.
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