Gold (XAUUSD) Price Forecast: Bullish Bias Holds Above 50-Day MA Despite Fed Pressure

Gold Holds Above $3,350 as Dollar Softens, but Fed Outlook and Strong Data Curb Gains

Gold prices edged higher on Friday, lifted by a weaker U.S. dollar and persistent geopolitical concerns, yet gains were tempered by strong U.S. economic data and steady Treasury yields, which continue to cap bullish momentum in the precious metal.

Spot gold was last up 0.56% to $3,357.57 after shedding 1.1% in the prior session. For the week, bullion is flat, up just 0.1%, struggling to decisively break above the key resistance at $3,377.66. The 50-day simple moving average at $3,324.90 continues to offer immediate support, with deeper downside protection sitting at $3,282.66 and $3,244.41.

Dollar Weakens but Rate Cut Bets Retreat on Strong U.S. Data

The dollar index fell 0.4% intraday on Friday but remains up 0.6% for the week, buoyed by hotter-than-expected U.S. data. June retail sales surprised to the upside, and initial jobless claims declined to a three-month low. These readings reinforce the view that the U.S. economy remains resilient, reducing urgency for Federal Reserve rate cuts.

Market expectations for Fed easing have pared back, with traders now pricing in around 45 basis points of cuts for the rest of the year—down from 50 basis points earlier in the week. That’s pressured gold’s appeal as a non-yielding asset, limiting its upside even with the dollar’s recent softness.

Geopolitical Risk from EU Sanctions on Russia Offers Floor to Prices

Gold’s safe-haven demand remains underpinned by geopolitical tensions. The European Union’s approval of its 18th sanctions package against Russia—targeting its oil and energy sectors—reminds traders that conflict-driven uncertainty is far from over. Such risks may help put a floor under gold, even if upside remains capped near-term.

Bond Yields Ease but Not Enough to Break Bullion Higher

U.S. Treasury yields drifted lower Friday, with the 10-year yield down 3.8 basis points to 4.425%. However, the decline was too modest to materially boost gold. Traders are also awaiting July’s University of Michigan Consumer Sentiment and housing data, both potential catalysts for fresh market direction.

Gold Prices Forecast: Bullish Bias Holds Above $3,324, but Breakout Uncertain

While gold holds above the 50-day moving average, repeated failures near $3,377.66 highlight strong resistance. A break above this level could open the door to retest $3,451.53, but continued strong U.S. data and reduced Fed cut expectations may stall upside in the near term. Bias remains cautiously bullish above $3,324.90, with a neutral tone prevailing unless $3,377 is breached convincingly.

More Information in our Economic Calendar.