Gold (XAUUSD) Price Forecast: Bulls Hold Above 50-Day as Fed Bets Rise, Dollar Caps Rally

Gold Hovers Above 50-Day Moving Average as Fed Cut Bets Mount

Gold held firm above key technical levels on Tuesday, consolidating recent gains near $3353.58, a short-term pivot, and the 50-day moving average at $3344.70. Traders appear hesitant to take bold positions without a definitive catalyst, with eyes now on next week’s U.S. CPI data to provide direction.

At 14:12 GMT, XAU/USD is trading $3373.57, down $0.06 or -0.00%.

Dollar Strength Caps Gold Upside as Traders Eye Fed Appointments

The dollar index climbed 0.3% to 98.864 after touching a one-week low earlier in the session, weighing on gold’s rally attempts. A firmer greenback reduced bullion’s appeal to holders of other currencies. However, softer U.S. jobs data has solidified market expectations of a dovish shift by the Federal Reserve.

July’s payrolls report came in weaker than expected, and downward revisions to May and June data slashed a combined 258,000 jobs. The CME FedWatch tool now puts the odds of a September rate cut at 92%, up from 63% a week ago. Traders are pricing in at least two quarter-point cuts this year, with Goldman Sachs projecting as many as three consecutive 25 basis-point cuts starting in September.

Further uncertainty emerged after President Trump dismissed the Bureau of Labor Statistics chief and announced plans to appoint a new Federal Reserve governor, potentially replacing Chair Jerome Powell. Analysts suggest this move could tilt policy more dovish, depending on the nominee’s stance.

Treasury Yields Edge Higher as Tariff Risks Mount

Treasury yields inched up, with the 10-year note at 4.222% and the 2-year at 3.714%, ahead of ISM services data. Trump’s fresh tariff threats—this time targeting Indian goods and hinting at semiconductor and pharmaceutical levies—have injected further geopolitical risk into markets. India pushed back strongly, defending its Russian oil purchases and criticizing Western double standards.

Gold Prices Forecast: Bulls in Control but Resistance Still Distant

Gold is trading above its 50-day moving average at $3344.80 and short-term pivot support at $3353.58, showing signs of strength after rebounding from the $3268.12 low. Tuesday’s candle confirms a second consecutive close above both levels, reinforcing bullish short-term momentum.

However, the market is still well below the $3439.04 and $3451.53 resistance levels, which capped rallies in late July and mid-June. Without a clear catalyst, traders are unlikely to challenge those highs in the near term. For now, the focus remains on next week’s U.S. CPI report, which could confirm the Fed’s dovish tilt and provide the momentum needed to extend the rally.

In the meantime, consolidation above the 50-day average favors a bullish bias. On the downside, a drop back below $3344 would expose $3310.48 and the key support zone at $3268.12.

Unless incoming data decisively strengthens the case for multiple Fed cuts, gold may continue to coil within this $3253.58 to $3344.80 area, with bulls waiting for confirmation to push higher.

More Information in our Economic Calendar.