Gold Prices Maintain Negative Bias, Hover Near Multi-Month High Reached on Wednesday

Gold price (XAU/USD) remains under pressure during the first half of the European session on Thursday, appearing to end a three-day winning streak that pushed it to its highest level since early November on Wednesday. The US Dollar (USD) continues to gain momentum for a second consecutive day, recovering further from its monthly low. Meanwhile, stable equity market performance weighs on the appeal of the safe-haven metal.

However, expectations that the Federal Reserve (Fed) will implement two rate cuts this year keep US Treasury bond yields in check, which should limit the USD’s upside and provide some support for the non-yielding Gold price. Additionally, uncertainty surrounding US President Donald Trump’s trade policies—potentially triggering trade wars and increasing market volatility—may help contain losses for XAU/USD. This calls for caution before concluding that the month-long uptrend in Gold has come to an end.

Gold Price Holds Negative Bias Amid Modest USD Strength; Downside Risks Remain Limited

• The US Dollar steadies above its lowest level since late December, supported by a modest rebound in US Treasury bond yields, pressuring Gold prices during Thursday’s session.
• A lack of clarity around US President Donald Trump’s tariff plans and easing geopolitical tensions contribute to a risk-on sentiment, further undermining demand for the safe-haven metal.
• Trump’s proposed policies are viewed as inflationary, which may prompt the Federal Reserve to maintain its hawkish stance and keep interest rates elevated for longer to curb rising price pressures.
• Despite this, markets are pricing in at least two Fed rate cuts by the end of the year, which could limit gains in US bond yields and the USD, offering some support to Gold.
• Investors are closely watching Trump’s speech at the World Economic Forum for concrete announcements on tariffs. Additionally, the release of US Weekly Jobless Claims may provide further direction for XAU/USD.
• The Bank of Japan is set to announce its policy decision on Friday, with expectations of a rate hike from 0.25% to 0.50%, the highest level since the 2008 financial crisis.
• Upcoming rate decisions from the Federal Reserve and European Central Bank next week are expected to inject volatility into markets, potentially influencing Gold prices.
  
  

Gold Price Bulls Maintain Control Above the $2,720-$2,725 Resistance Breakpoint

From a technical perspective, any further decline in Gold prices is expected to find solid support near the $2,625-$2,620 horizontal resistance-turned-support zone. A sustained break below this level could lead to a dip toward the $2,700 mark. If this support fails, it may open the door for deeper losses, with the next key levels around $2,665-$2,662 and eventually the $2,627-$2,622 region. The latter zone is reinforced by the 100-day Exponential Moving Average (EMA) and a short-term ascending trendline, which are likely to act as a crucial pivot point for short-term traders.

On the upside, initial resistance is seen near the overnight high of $2,763-$2,764. A break above this level could set the stage for a retest of the all-time high around the $2,790 mark, last touched in October. Further gains beyond the psychological $2,800 threshold would likely act as a catalyst for renewed bullish momentum, signaling an extension of the month-long uptrend.