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Gold price struggles to capitalize on modest intraday gains; holds above $3,000

  • Gold price edges higher and snaps a three-day losing streak, though it lacks follow-through. 
  • The USD sticks to its recent recovery gains to a three-week top and caps the XAU/USD pair. 
  • Fed rate cut bets continue to act as a tailwind for the precious metal ahead of the US data. 

Gold price (XAU/USD) struggles to build on modest intraday gains, though it manages to hold above the $3,000 psychological mark through the first half of the European session on Tuesday. The global risk sentiment remains well supported by hopes for less disruptive US trade tariffs, optimism over the Russia-Ukraine peace deal, and China's stimulus measures. Furthermore, the US Dollar (USD) preserved its recent recovery gains to a near three-week high touched on Monday, which, in turn, acts as a headwind for the precious metal.

However, the growing acceptance that the Federal Reserve (Fed) will resume its rate-cutting cycle soon holds back the USD bulls from placing aggressive bets and lends some support to the non-yielding Gold price. Adding to this, the lack of follow-through selling below the $3,000 pivotal point warrants some caution before confirming that the XAU/USD has topped out in the near term and positioning for an extension of the recent pullback from the all-time peak. Traders now look forward to the US economic releases for short-term opportunities. 

Daily Digest Market Movers: Gold price lacks bullish conviction amid positive risk tone

  • The global risk sentiment remains well supported by hopes that US President Donald Trump's so-called reciprocal tariffs, set to take effect on April 2, will be narrower and less strict than initially feared. 
  • Russian state media RIA reported that a joint statement from the US and Russia is expected on Tuesday after day-long talks in Saudi Arabia focused on a narrow proposal for a Black Sea maritime ceasefire deal.
  • According to a Financial Times report, China is considering including services in a subsidy program to stimulate consumption, further boosting investors' confidence and undermining the safe-haven Gold price. 
  • The US Dollar holds steady near a three-week high touched on Monday in reaction to the better-than-expected release of US Composite PMI, which rose to 53.5 in March from the 51.6 previous month. 
  • The Federal Reserve last week lowered its 2025 growth forecast and hiked its inflation outlook amid uncertainty over Trump's tariffs, though signaled that it is likely to deliver two 25 basis points rate cuts in 2025.
  • Meanwhile, concerns about US economic growth saw traders lift bets that the Fed could resume its policy-easing cycle soon, which caps further USD gains and lends support to the non-yielding yellow metal. 
  • Atlanta Fed President Raphael Bostic said on Monday that he anticipates slower progress on inflation in coming months and sees the central bank cut the benchmark rate only a quarter of a percentage point in 2025.
  • Traders now look to Tuesday's US economic docket – featuring the release of the Conference Board's Consumer Confidence Index, New Home Sales, and the Richmond Manufacturing Index – for some impetus. 
  • Apart from this, speeches by influential FOMC members could drive the USD demand and produce short-term opportunities around the XAU/USD pair later during the North American session. 
  • The focus, however, will remain glued to the US Personal Consumption Expenditure (PCE) Price Index on Friday, which could provide fresh cues about the Fed's future rate-cut path. 

Gold price traders seem non-committed; the $3,000 psychological mark holds the key for bulls

fxsoriginal

From a technical perspective, the XAU/USD pair has been showing some resilience near the $3,000 mark. The said handle is likely to act as a key pivotal point, which if broken decisively might prompt some technical selling and drag the Gold price to the $2,982-2,978 region. The corrective fall could extend further towards the $2,956-2,954 resistance breakpoint, now turned support. 

On the flip side, the $3,033 area, or the overnight swing high, now seems to act as an immediate hurdle ahead of the all-time peak, around the $3,057-3,058 zone touched last week. Given that oscillators on the daily chart are holding comfortably in positive territory, some follow-through buying will be seen as a fresh trigger for bulls and set the stage for an extension of a multi-month-old uptrend.

Economic Indicator

Consumer Confidence

The Consumer Confidence index, released on a monthly basis by the Conference Board, is a survey gauging sentiment among consumers in the United States, reflecting prevailing business conditions and likely developments for the months ahead. The report details consumer attitudes, buying intentions, vacation plans and consumer expectations for inflation, labor market, stock prices and interest rates. The data shows a picture of whether or not consumers are willing to spend money, a key factor as consumer spending is a major driver of the US economy. Generally, a high reading is bullish for the US Dollar (USD), while a low reading is bearish. Note: Because of restrictions from the Conference Board, FXStreet Economic Calendar does not provide this indicator's figures.

Read more.

Next release: Tue Mar 25, 2025 14:00

Frequency: Monthly

Consensus: -

Previous: -

Source: Conference Board

Author

Haresh Menghani

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

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