Daily Price Outlook
Gold (XAU/USD) is currently hovering around $3,260, following a three-day losing streak that was halted by a slight bounce. This struggle can be attributed to easing tariff tensions and growing hopes of a potential trade deal between the United States and China.
Initially, the market reacted negatively, but the rising uncertainty and potential risks from these trade talks have increased demand for Gold as a safe-haven asset, pushing its price higher. Investors typically turn to Gold when trade tensions or economic uncertainties rise.
Meanwhile, the statement from China’s Commerce Ministry highlighted the US’ repeated expressions of willingness to engage in tariff discussions, signaling potential progress.
However, China also urged the US to demonstrate “sincerity” before formal talks could begin, indicating that there are still hurdles to overcome before an agreement is reached.
This hope for a de-escalation in trade tensions has overshadowed Gold’s rally, as the precious metal is often seen as a safe-haven asset during periods of uncertainty. The easing of trade-related concerns typically shifts investor interest away from Gold, driving its price lower.
Fed's Interest Rate Decisions and the Impact on Gold
Looking ahead, the Federal Reserve’s stance on interest rates remains a crucial element for Gold’s trajectory. As of now, the CME FedWatch tool shows that the probability of an interest rate cut at the Fed’s May meeting stands at just 6.4%, while the odds of a cut in June are at 57.8%.
However, the significant shift in market sentiment could occur if the Nonfarm Payrolls data, set to be released later this Friday, comes in significantly below expectations.
A weak jobs report could heighten expectations for a rate cut, which would likely benefit Gold by weakening the US Dollar and increasing demand for the metal.
GOLD (XAU/USD) – Technical Analysis
Gold is trading within a descending channel after failing to sustain above the $3,294.47 resistance, corresponding with the 78.6% Fibonacci retracement level from the April high to recent lows.
Price recently rebounded from the $3,202.89 low, printing a modest sequence of higher lows that hint at a short-term recovery attempt, but overall bias remains bearish unless price breaks above the channel resistance.
Technically, a spinning top formed on the latest 4H candle signals indecision after a small bullish impulse. RSI stands at 44.04, still below the 50 neutral line, reflecting sluggish momentum.
There’s also a mild bullish divergence between RSI and price lows, suggesting downside momentum may be fading—but it's not strong enough to flip sentiment without confirmation.
The 50-SMA at $3,313.58 continues to slope downward, reinforcing resistance around the $3,294 pivot. Price is currently pressing against the 38.2% Fib level at $3,247, and struggling to reclaim ground above the $3,261 midpoint. Until bulls can close decisively above $3,294, rallies may be sold.
Key support lies at $3,230, the 23.6% Fib, followed by the recent swing low at $3,202. A drop below $3,230 could invite another wave of selling, potentially forming a three black crows pattern if the next candles turn aggressively bearish.
A bearish bias holds unless price breaks and holds above $3,294 with volume.
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