Article by: ETO Markets
Gold dipped toward the $3,300 level for the second day running in Wednesday’s Asian session as easing U.S.–China trade tensions and President Trump’s two-year tariff reprieve on domestic auto sourcing underpinned risk appetite, even as a modest U.S. dollar uptick weighed on the non-yielding metal. Traders remain wary, however, that Trump’s unpredictable trade stance could undermine confidence in U.S. assets, and growing market anticipation of imminent Federal Reserve rate cuts continues to cap dollar strength and buoy gold. This dovish outlook was reinforced by March’s JOLTS report showing job openings down to 7.19 million and April’s Conference Board consumer confidence plunging to a five-year low of 86.0 (with the Present Situation and Expectations indices at 133.5 and 54.4, respectively), all of which strengthen the case for more aggressive Fed easing. Geopolitical developments—the rejection of Ukraine’s proposed 30-day extension to Russia’s three-day ceasefire by Moscow and U.S. warnings to push back on mediation without concrete proposals—have further limited gold’s downside. Attention now turns to key U.S. data later this week, including the ADP employment report, advance Q1 GDP, PCE Price Index and Friday’s Nonfarm Payrolls, any of which could provide fresh impetus for both the greenback and gold.
From a technical perspective, XAU/USD remain firmly bullish, but a slip below the immediate $…–$… zone—which coincides with the 38.2% Fibonacci retracement of the rally from the mid-$… monthly swing low—would likely draw dip-buyers into the sturdier $…–$… area. Should that support yield, the next Fibonacci floor at 50% of the recent up-move sits near $… before the larger $… barrier comes into view. On the upside, renewed strength above this week’s Asian session peak around $… could encounter supply between $… and $…, followed by the $…–$… zone; surmounting those levels should pave the way for a retest of $…, then the intermediate hurdles at $…–$…, and ultimately a fresh bullish assault on the $… psychological landmark.
