Gold Prices Hold Near Two-Week Low Despite Ceasefire Reports and Dovish Fed Signals

Gold (XAU/USD) remained under pressure on Tuesday, hovering near a two-week low around $3,333 in early Asian trading. Although safe-haven demand faded after U.S. President Donald Trump announced a ceasefire agreement between Israel and Iran, geopolitical uncertainty and weak U.S. dollar momentum kept losses limited for the precious metal.

Ceasefire Announcement Fails to Calm Markets Completely

While President Trump’s announcement sparked optimism in global markets, conflicting reports from Iran and Israel prevented a full risk-on rally. Iran’s Foreign Minister stated that hostilities would only cease if Israel halted its military actions. In contrast, the Israeli Defense Forces (IDF) confirmed missile activity from Iranian territory aimed at southern Israel, suggesting that tensions are far from resolved. This undercurrent of geopolitical instability continues to support demand for gold.

Fed Dovishness and Weak Dollar Offer Support

The U.S. Dollar Index (DXY) slumped to near 98.10, extending its decline from a two-week high after Federal Reserve officials hinted at potential rate cuts. Governor Michelle Bowman said the Fed should start weighing downside risks to the job market and signaled openness to cutting rates as soon as July. Her comments echoed earlier dovish sentiment from Fed Governor Christopher Waller, who also floated the possibility of easing policy at the July 29–30 FOMC meeting.

This shift in Fed tone has boosted speculation of imminent monetary easing, pressuring the dollar and giving gold a modest lift despite the overall bearish technical setup.

U.S. Economic Data Mixed Ahead of Powell’s Testimony

Recent U.S. PMI figures added to the cautious mood. S&P Global’s flash Manufacturing PMI held steady at 52.0 in June, while the Services PMI eased to 53.1 from 53.7. The Composite PMI also dipped slightly to 52.8. Markets now await upcoming data releases including the Consumer Confidence Index and Richmond Fed Manufacturing Index.

However, the spotlight remains firmly on Fed Chair Jerome Powell, whose testimony before Congress later today could shape market expectations around the Fed’s policy direction.

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🔍 XAU/USD Technical Outlook: Pressure Builds Below Key Levels

Gold’s short-term outlook has weakened after breaching the 100-period SMA on the 4-hour chart and slipping below ascending channel support. Bearish momentum is building, with technical indicators showing increased negative traction.

📉 Key Support Levels:

• Immediate support: $3,323–$3,322
• Below that: Possible slide toward sub-$3,300 territory

📈 Key Resistance Levels:

• Minor hurdle: $3,368–$3,370
• Strong resistance: $3,400
• Breakout level: $3,434–$3,435
• Medium-term target: $3,451–$3,452 (recent two-month high)
• Ultimate upside: $3,500 (psychological all-time high)

Unless gold reclaims the $3,370 level convincingly, rallies may remain capped and fresh selling pressure could dominate.

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📌 Conclusion: Gold Remains Range-Bound Amid Mixed Signals

Despite a temporary pullback triggered by ceasefire news, the broader narrative for gold remains complex. Lingering geopolitical threats, combined with rising expectations of Fed rate cuts, are creating a tug-of-war scenario. Traders should remain cautious ahead of Powell’s testimony and monitor upcoming U.S. economic releases for short-term direction.

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