Daily Price Outlook
Gold (XAU/USD) is facing strong bearish pressure as it tumbles below the key $3,100 level during the U.S. trading session on Thursday.
The precious metal dropped over 1.35%, reaching $3,085 at the time of writing. This sharp decline comes as traders take profits, pushing gold below crucial support levels amid a broader market reaction to President Donald Trump’s recent tariff announcement.
Trump’s Tariff Plan Fuels Market Uncertainty
As per the latest, Trump's surprising statement about imposing a 10% global base tariff on all imports into the U.S. has added new uncertainty to the financial markets.
These tariffs will be in place along with the existing ones, causing concern among global investors. This has particularly affected Asia, where gold producers saw some initial gains. Additionally, as of Thursday, a 54% tariff is now being applied to Chinese imports, further increasing trade tensions.
Despite the initial rise in gold prices due to increased demand for safe-haven assets, global markets are still assessing the full impact of Trump's announcement.
The new tariff plan has raised concerns about a potential global economic slowdown. Meanwhile, the stocks have dropped sharply, and bond yields are falling as investors move towards safer options like U.S. Treasuries. Meanwhile, the U.S. dollar has weakened against major currencies.
Market Reaction to U.S. Economic Data and Fed Expectations
On the other hand, the economic data is also shifting expectations around U.S. monetary policy. According to the CME FedWatch tool, the probability of an interest rate cut in May is standing at 21.5%, with a larger chance of a rate cut in June at 27.5%.
Hence, the pause in the Fed’s rate decisions appears increasingly likely, as traders begin to factor in the potential fallout from the tariff-induced economic slowdown.
Moreover, U.S. Treasury Secretary Scott Bessent has commented that tariffs could be lifted or removed if countries bring their production back to the U.S.
This has added more uncertainty to the situation, as markets are still unsure about the future direction of U.S. trade policy.
Strong Safe-Haven Demand for Gold Amid Market Uncertainty
Despite the recent drop in gold prices, the underlying demand for safe-haven assets remains strong. The broader market uncertainty, coupled with fears of an economic slowdown, has shifted flows into gold, which is traditionally seen as a hedge against instability.
Traders are closely monitoring the U.S. economic data for further clues, particularly the upcoming Nonfarm Payrolls (NFP) report and the ISM Services PMI.
GOLD (XAU/USD) – Technical Analysis
Gold continues to consolidate within a rising parallel channel, with price action testing support near the channel’s lower boundary around $3,111.
This level also coincides with the key pivot point, providing a critical juncture for short-term market direction. Price is currently hovering just below the 50-period Simple Moving Average (SMA), which is positioned at $3,128.34—acting as dynamic resistance in the current structure.
On the upside, immediate resistance sits at $3,144. A breakout above this level would signal renewed bullish momentum, exposing higher resistance targets at $3,148 and $3,167.
Beyond that, the next bullish target stands at $3,184, where the upper boundary of the channel may curb further gains. On the downside, a failure to hold $3,111 would likely invite fresh selling pressure, targeting $3,096 and $3,084 as next support zones.
The RSI is currently at 44.32, signaling weakening momentum after recently retreating from overbought territory.
The bearish divergence between price highs and RSI peaks suggests some fatigue among buyers. Still, the bullish channel remains valid, and traders are closely watching the $3,111 level as a potential re-entry point.
Bullish bias remains intact above $3,111. A long position from $3,111 with a target at $3,144 and stop loss at $3,096 offers a favorable risk-reward.
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