Gold Price Forecast: XAU/USD marching slowly towards $3,400

XAU/USD Current price: $3,384.41

• US President Trump threatened new tariffs and tried to fire Fed Governor Cook.
• The US CB Consumer Confidence index ticked slightly lower in August.
• XAU/USD trades near fresh weekly highs, aiming to extend its advance.

Gold prices seesawed between gains and losses late on Monday, falling towards $3,351.39 early on Tuesday. The bright metal later recovered, peaking at around $3,386, to finally stabilize near its intraday peak.

Markets turned risk-averse early in Asia, following comments from United States (US) President Donald Trump. Trump once again put into doubt the Federal Reserve (Fed) independence by deciding to fire Governor Lisa Cook amid allegations of mortgage application irregularities. Cook denied Trump’s authority to dismiss her and said she will remain as Governor. The case will likely end in a courtroom. Other than that, President Trump threatened to impose new tariffs on those countries applying digital taxes on US tech companies.

Asian and European indexes closed in the red, while the US Dollar (USD) benefited from the risk-averse environment, trimming most of its Friday’s losses.

Wall Street, however, managed to post some modest gains after better-than-anticipated US data lifted the mood. On the one hand, the US published July Durable Goods Orders, which were down 2.8%, better than the previous 9.3% and the expected -4%.

On the other hand, the Conference Board Consumer Sentiment eased slightly to 97.4 in August from a revised 98.7 in July, but beat the expected 96.4. The report also showed that the Present Situation Index dropped by 1.6 points to 131.2, while the Expectations Index fell by 1.2 points to 74.8, remaining below the 80-point level usually associated with recession fears.

XAU/USD short-term technical outlook

The better mood weighed on USD demand, helping XAU/USD to regain its bullish poise. The pair is neutral-to-bullish according to technical readings in the daily chart, as it held above all its moving averages. In fact, a flat 20 Simple Moving Average (SMA) provided intraday support at around $3,350. Technical indicators, in the meantime, turned north, although the Momentum indicator remains within neutral levels, reflecting limited buyers’ strength.

In the near term, and according to the 4-hour chart, XAU/USD is bullish. The pair bounced from a bullish 20 SMA, which is now crossing above a flat 100 SMA after already surpassing the 200 SMA. Technical indicators, in the meantime, resumed their advances well into positive territory, supporting higher highs ahead.

Support levels: 3,368.20 3,350.50 3,337.60

Resistance levels: 3,391.20 3,405.80 3,421.10