Gold prices remain in the spotlight, trading above $3,330 and heading for a more than 1.5% weekly increase, as an escalation of global trade tensions and a softer US Dollar increase safe-haven buying. US President Trump’s announcement of tariffs between 10% and 70% to kick in on August 1 has increased market wariness, and Treasury Secretary Bessent’s remarks regarding potential retaliatory tariffs in 100 countries further fueled uncertainty. Strong US labor fundamentals and stiff Treasury yields notwithstanding, expectations of a Federal Reserve pause in interest rates are sustaining bearish optimism. Investors are waiting with bated breath for future FOMC minutes and jobless claims releases for further guidance.
KEY LOOKOUTS
• Traders await the effect of Trump’s suggested 10% to 70% tariffs and their effect on global trade and safe-haven investments such as gold.
• As there is decent labor data and consistent yields, traders are waiting for hints in future FOMC meeting minutes on any likely rate actions.
• Declining US Dollar in the face of growing national debt and conservative Fed rhetoric may continue to buoy gold prices.
• The key resistance remains at $3,400 and $3,452, while a break below $3,300 may pave the way towards $3,246 or even $3,120.
Gold is holding firm above $3,330, rising more than 1.5% this week as investors move towards safe-haven assets due to geopolitical tensions and fears of trade wars. The revelation of possible US tariffs of 10% to 70%, to be rolled out on August 1, triggered fears of the strain on world economies, further damaging the US Dollar and supporting bullion demand. Though robust US labor statistics and solid Treasury yields will constrain upside potential, hopes of a dovish Federal Reserve policy are sustaining gold’s rally. Traders now anticipate FOMC minutes and jobless claims for better hints at monetary policy.
Gold prices creep up past $3,330 with trade war concerns and a weakening US Dollar driving safe-haven demand. Investors will be waiting for important Fed cues next week, with FOMC minutes and jobless claims being watched.
• Gold is trading above $3,330, more than 1.5% higher for the week, on safe-haven demand.
• Trump imposes tariffs of 10% to 70%, starting August 1, raising specter of trade war.
• US Treasury Secretary expects retaliatory tariffs from about 100 nations.
• US Dollar drops under pressure from surging national debt and policy uncertainty.
• US labor market remains resilient, but private sector hiring weakens in face of economic prudence.
• Gold’s rally limited by solid US Treasury yields, with the 10-year at 4.338%.
• Technical levels to monitor: Resistance at $3,400/$3,452, support at $3,300/$3,246.
Gold is picking up steam as investors flock to the yellow metal for safe haven as geopolitical and economic tensions grow. Former President Donald Trump’s announcement of future tariffs between 10% and 70% on various nations has set the markets in a state of panic. Treasury Secretary Scott Bessent added that almost 100 nations were potentially in the crosshairs for reciprocal tariffs, which has heightened fears over global trade disruptions. These events have boosted demand for gold, a classic safe-haven investment, particularly as market players prepare for possible ripple effects on economies.
XAU/USD DAILY PRICE CHART
SOURCE: TradingView
Apart from the trade tensions, political events and fiscal issues in the US are contributing to the allure of gold. The suggested extension of the 2017 tax reductions through the “One Big Beautiful Bill” would add $3.4 trillion to the national deficit, which could weaken the US Dollar in the long run. At the same time, geopolitical discussions—like Trump’s recent talks with Russia and Ukraine leaders—show that there is still instability, driving investors deeper into assets such as gold. As markets are taking in these wider risks, gold continues to reap the rewards of acting as a hedge against uncertainty.
TECHNICAL ANALYSIS
Gold is still consolidating above the pivotal $3,300 support level, and momentum gauges such as the Relative Strength Index (RSI) are holding near the middle ground, hinting at a slowdown in bull runs. Gold has not broken out above its last cycle high of $3,452, which implies that the buyers are going to require stronger drivers to turn the prices higher. A breakout above $3,400 and $3,452 would confirm renewed bullish strength, targeting the all-time high near $3,500. On the downside, sustained weakness below $3,300 could open the door for a pullback toward $3,246, a critical level for maintaining the broader uptrend.
FORECAST
If the geopolitical tensions rise further and the US Dollar stays weak, gold may return to strong bullish momentum. A clear break above the $3,400 level would most probably attract more buyers, with the subsequent target lying at $3,452—the former cycle high. Breaking above this resistance area might move prices towards the psychological benchmark of $3,500, particularly if the Federal Reserve sticks to a dovish policy or economic uncertainty accelerates.
On the other hand, if US data remains to be resilient—specifically in labor markets and inflation—and Treasury yields continue to advance, gold can come under selling pressure. A break below the $3,300 support level might initiate a more profound correction down to $3,246. If this support level also breaks, further losses might result in a test of the $3,120 area where buyers might re-enter to protect the longer-term bullish trend.
