- Gold forecast tumbles as risk sentiment improves globally, while investors book profit.
- Gold finds no respite despite Fed’s imminent rate cut this week.
- Traders look forward to the US HPI Y/Y and US Consumer Confidence for more impetus today.
The gold forecast shows a strong bearish trend as the asset traded was just above $3,900 in Tuesday’s European session. The decline stems from the progress of US-China trade talks. The buyers failed to hold the key levels as sharp profit-taking emerged after a parabolic rise, seen in the last four months.
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Softening geopolitical risk premium also weighs on the precious metal. The recent negotiations between the US and China on trade tariffs and rare earth minerals triggered a fresh wave of risk-on sentiment, pulling investors from the safe-haven gold to the risk assets like equities. Adding further to these dynamics, the US President Trump signed framework deals with Thailand, Vietnam, Cambodia, Japan, and Malaysia. The move signals economic stability and reduced uncertainty.
Gold’s dip comes ahead of the FOMC meeting this week, where the Federal Reserve is expected to cut the 25-bps rate. Historically, lower interest rates have benefited gold prices, supporting a non-yielding asset.
Gold Daily Key Events
The major events on the day include:
- US S&P/CS Composite-20 HPI
- US Significant HPI M/M
- US Richmond Manufacturing Index
- US CB Consumer Confidence
On Tuesday, traders look forward to the US HPI Y/Y and US HPI M/M, Richmond Manufacturing Index, and CB Consumer Confidence to gain insights into inflation, growth, and consumer sentiment.
Gold Technical Forecast: Bears Pounce 200-MA, Eyeing More Losses
Gold’s 4-hour chart shows a strong bearish trend after struggling to hold above the $4,000 level. The price stays well below the 50- and 100-MA around $4,067 and $4,105, respectively, indicating a solid bearish pressure. Meanwhile, the 200-SMA support, around $3,920, briefly broke, which could trigger a temporary consolidation phase.
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The RSI plunging below the 30.0 zone indicates overbought conditions, suggesting a probable pause in the downside. However, a sustained break above $4,067 could alter the trend, extending gains towards the $4,105 and $4,166 levels. Conversely, a drop below $3,900 could trigger further downside towards $3,850.
Support Levels
Resistance Levels
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