Gold Price Forecast: XAU/USD consolidates near record highs

Valeria Bednarik FXStreet

XAU/USD Current price: $3,130.31

Better than anticipated United States data underpinned the market mood.
US President Donald Trump will announce fresh tariffs through a press conference.
XAU/USD consolidates near record highs, bulls retain control in the near term.

Spot Gold consolidated for most of this Wednesday, hovering around the $3,130 level and confined to Tuesday’s range. The XAU/USD trades marginally higher on a daily basis in the mid-American session, with speculative interest awaiting United States (US) President Donald Trump's press conference.

The US President is about to announce his decision on reciprocal tariffs in a press conference scheduled for 20:00 GMT. Market talks suggest such levies will come into effect right after the announcement, as hinted by US officials on Tuesday. The extent of taxes, however, remains a mystery.

The mood somehow improved after Wall Street’s opening, with the three major indexes trading in the green, despite the sour tone of their European counterparts. Better than anticipated US data indeed underpinned the mood.

The March ADP Employment Change report showed that the private sector created 155K new jobs in the month, much better than the 105K expected or the previous revised 84K. Additionally, February Factory Orders were up 0.6%, beating the 0.5% anticipated.

XAU/USD short-term technical outlook

From a technical point of view, the daily chart for the XAU/USD pair shows it could extend its advance. The pair trades above all its moving averages, with the 20 Simple Moving Average (SMA) accelerating north and providing dynamic support at around $3,012.90. At the same time, the Relative Strength Index (RSI) indicator resumed its advance within overbought levels, while the Momentum indicator turned south, but holds within positive levels, not enough to confirm another leg south.

In the near term, and according to the 4-hour chart buyers retain control. A bullish 20 SMA attracted buyers throughout the day, currently at $3.115.00. The 100 and 200 SMAs, in the meantime, gain upward traction far below the shorter one. Finally, the Momentum indicator aims marginally lower at around its midline, while the RSI indicator consolidates at around 62, limiting the bearish scope for XAU/USD.

Support levels: 3,123.60 3,012.90 3,097.50

Resistance levels: 3,136.70 3,150.00 3,175.00

Tariffs FAQs

What are tariffs?

Tariffs are customs duties levied on certain merchandise imports or a category of products. Tariffs are designed to help local producers and manufacturers be more competitive in the market by providing a price advantage over similar goods that can be imported. Tariffs are widely used as tools of protectionism, along with trade barriers and import quotas.

What is the difference between taxes and tariffs?

Although tariffs and taxes both generate government revenue to fund public goods and services, they have several distinctions. Tariffs are prepaid at the port of entry, while taxes are paid at the time of purchase. Taxes are imposed on individual taxpayers and businesses, while tariffs are paid by importers.

Are tariffs good or bad?

There are two schools of thought among economists regarding the usage of tariffs. While some argue that tariffs are necessary to protect domestic industries and address trade imbalances, others see them as a harmful tool that could potentially drive prices higher over the long term and lead to a damaging trade war by encouraging tit-for-tat tariffs.

What is US President Donald Trump’s tariff plan?

During the run-up to the presidential election in November 2024, Donald Trump made it clear that he intends to use tariffs to support the US economy and American producers. In 2024, Mexico, China and Canada accounted for 42% of total US imports. In this period, Mexico stood out as the top exporter with $466.6 billion, according to the US Census Bureau. Hence, Trump wants to focus on these three nations when imposing tariffs. He also plans to use the revenue generated through tariffs to lower personal income taxes.

Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

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