Article by: ETO Markets
Gold prices are edging higher with modest gains above $3,000, finding some footing after a three-day slide, thanks to a softer US dollar and growing expectations that the Federal Reserve will soon kick off its rate-cutting cycle again. A weaker US dollar, coupled with worries about a potential tariff-driven economic slowdown in the US, is giving gold a leg-up as a non-yielding asset. On the flip side, a brighter global risk mood—spurred by hopes of less disruptive US trade tariffs, progress in Russia-Ukraine peace talks, and optimism around China’s economic stimulus—could put a lid on gold’s upside, denting its safe-haven charm. Market sentiment is sitting on the cautious side, with traders eyeing Tuesday’s US economic releases, like the Conference Board’s Consumer Confidence Index, New Home Sales, and the Richmond Manufacturing Index, alongside Fed speeches, for clues on where gold might head next.
Gold (XAUUSD) is hovering around $… after pulling back from its recent high of $…, showing signs of consolidation with a pattern of lower highs on the daily chart, hinting at fading bullish steam. Resistance is looming at $…, based on the overnight swing high, with the all-time peak at $…posing a tougher barrier. On the downside, the $… psychological level is holding firm as a key support, backed up by the 10-day SMA at $… and the 23.6% Fibonacci retracement at $…, calculated from the rally between $… and $…. If that gives way, the price could slide towards the 38.2% Fibonacci level at $…, with further support near the 50% retracement at $…, close to the 20-day SMA at $…. Technical signals, like a shrinking MACD histogram and the Stochastic oscillator easing off overbought levels, point to a bearish tilt, suggesting room for more of a correction in the near term.
