Article by: ETO Markets
Gold extended its slide to around $3,315 per ounce in early Asian trading on Wednesday as easing U.S.–China trade tensions and buoyant risk sentiment dented demand for the traditional safe-haven asset. President Trump’s decision to cap automotive duties so that tariffs on foreign-made cars cannot be stacked with other levies, together with exemptions for certain U.S. exports from retaliatory tariffs and “very good” offers from key trade partners, has reduced geopolitical uncertainty—and therefore gold’s appeal, as Jateen Trivedi of LKP Securities observes. Market participants are now braced for a busy U.S. data slate later today, including the ADP Employment Change, the Personal Consumption Expenditures Price Index and the flash Q1 GDP report, while Friday’s April jobs report—forecast to show 130,000 new positions and a steady 4.2% unemployment rate—could further sway the dollar and, by extension, dollar-denominated commodities like gold.
From a technical perspective, despite an overall uptrend remaining intact, gold has spent the past five trading days stuck in a tight $…–$… range, unable to decisively breach either the $… support floor or the $… resistance ceiling. The Relative Strength Index still sits in bullish territory, but its downward slope toward the neutral 50 line suggests that neither buyers nor sellers currently hold sway. A decisive drop below today’s $… mark would likely send XAU/USD back to the April 23 swing low at $…—and, if momentum accelerates, down toward the critical $… level. Conversely, a clear rally above $… would open the door to $…, with the all-time high of $…coming into view thereafter.
