gold prices are currently hovering around $2,640, with market participants anticipating the release of critical US employment data on Tuesday. The US Dollar has experienced a recovery following a significant sell-off spurred by tariff plans proposed by former President Trump. At the moment, gold appears to be in a consolidation phase, with the daily Relative Strength Index (RSI) indicating a neutral sentiment.
Early on Tuesday, gold is facing a crucial resistance near $2,635 after a two-day decline from three-week highs of $2,665. Traders in the gold market are hesitant to make new directional bets as they await significant economic indicators, specifically the US ISM Services Purchasing Managers’ Index and the JOLTS Job Openings report. Despite fluctuations on Monday, gold remains trapped in a familiar trading range as investors digest both the implications of Trump’s tariff strategies and upcoming US economic data ahead of the Nonfarm Payrolls report due on Friday.
The recent downturn in gold prices was exacerbated by disappointing demand signals from India, driven by rising domestic prices linked to a depreciating Indian Rupee. Additionally, Goldman Sachs has revised its gold price forecast, delaying the anticipated rise to $3,000 per ounce initially projected for late 2025, which has further pressured gold prices. However, fresh buying interest emerged during American trading hours as the US Dollar weakened significantly following a report stating that Trump’s team was considering targeted tariffs on sectors critical to national security. This prompted Trump to refute the report, leading the Dollar to regain some strength and, in turn, putting downward pressure on gold .
Looking ahead, expectations around Trump’s tariff policy announcements, US employment figures, and the overall market mood are likely to influence gold prices. Moreover, a critical speech by Richmond Federal Reserve President Thomas Barkin concerning the economic outlook will be of particular interest, as it could provide clues about future Fed policies. Currently, gold prices are anchored near the 21-day Simple Moving Average (SMA) at $2,636, with immediate support identified at the 100-day SMA around $2,627. Should prices drop below this level, a retest of last week’s low of $2,596 may occur, while regaining control above the 50-day SMA at $2,648 would set sights on recent highs near $2,665 and potentially challenge the $2,700 mark.
