Gold prices fell below $2,900 on Monday, as the US Dollar (USD) rebounded from a multi-month low. Despite weaker US labor market data, a mild recovery in Treasury yields and uncertainty around Trump’s tariff policies have put pressure on the yellow metal.
Key Market Movers: Why is Gold Falling?
1️⃣ US Dollar Rebounds
- The USD Index (DXY) bounced from its lowest level since November, weighing on XAU/USD.
- Higher interest rate expectations in the US could further limit gold’s upside.
2️⃣ Federal Reserve Rate Cut Bets
- Recent weaker US employment data increased bets that the Fed could cut rates this year.
- However, the pace of rate cuts remains uncertain, capping gold’s rally.
3️⃣ Trump’s Trade Policies Create Market Jitters
- US President Donald Trump continues to threaten new tariffs, impacting global markets.
- Uncertainty over trade war effects fuels safe-haven demand for gold but also strengthens USD.
Gold Price Outlook: Key Levels to Watch
📉 Support Levels:
- $2,895 – Strong horizontal support zone
- $2,860-$2,858 – Potential deeper correction
- $2,800 – Psychological round number
📈 Resistance Levels:
- $2,925-$2,930 – Key supply zone
- $2,956 – All-time high reached on Feb 24
- $3,000 – Psychological target
Technical Analysis: Is Gold Headed for a Pullback?
- Oscillators remain in positive territory, but losing momentum.
- Repeated failures to break above $2,930 could trigger further corrections.
- A break below $2,895 might accelerate the decline toward the $2,860 zone.
Final Thoughts: Is Gold Still a Buy?
- Despite near-term volatility, gold remains supported by long-term macro factors.
- If the Fed signals aggressive rate cuts, gold could resume its uptrend.
- Investors should watch Trump’s next policy moves and US inflation data for further clues.
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