Gold (XAUUSD) Price Forecast: Dollar Strength Drives Gold Below 50-Day Moving Average

Gold’s Sharp Reversal: Dollar Strength Triggers Bearish Wave

Gold tumbled 0.82% to $3,307.71 on Monday, hitting near one-week lows as dollar strength and tariff uncertainty weighed on the precious metal.

The pullback triggered widespread bearish commentary from analysts citing physical demand destruction and Federal Reserve policy concerns as key headwinds.

At 10:44 GMT, XAU/USD is trading $3298.23, down $38.38 or -1.15%.

Fed Minutes This Week: Will Strong Jobs Data Kill Rate Cut Hopes?

Strong June employment data continues to reshape Fed expectations, with analysts warning that robust labor market conditions eliminate prospects for July rate cuts.

Fed meeting minutes due later this week will provide additional clarity on the central bank’s rate path as Trump’s tariff deadline approaches.

Rate Cut Door Slams Shut: How Hawkish Will Powell Turn?

Federal Reserve policy shifts create unfavorable conditions for gold as economists expect a more hawkish stance.

Capital Economics warned that “Trump’s tariff proposals and a more hawkish Fed do add to the downside risk for gold,” while ClearBridge Investments noted the “solid June jobs report slams the door shut on a July rate cut.”

Physical Demand Destruction: Is Gold Pricing Itself Out of Markets?

Gold faces multiple bearish catalysts as physical demand weakens globally.

HSBC’s James Steel highlighted that “underlying physical demand is down because of high prices,” noting jewelry demand destruction in India where ten-gram bars now cost ₹71,000, double recent levels.

The dollar rose 0.4% against rivals, making gold more expensive for international buyers.

Critical Support Breakdown: Can $3,000 Hold the Line?

XAU/USD broke below the 50-day moving average at $3,307.87 and short-term pivot at $3,310.48, opening downside to the June 30 low at $3,244.41.

City Index targets $3,136, $3,073, and the critical $3,000 level if selling accelerates.

Bearish reversal patterns including Shooting Star formations near $3,503.19 resistance signal momentum deterioration.

Recovery requires a break above last week’s swing high at $3,365.92 to target $3,451.53-$3,500.20.

Trump’s Tariff Gambit: Will August 1 Deadline Crush Safe-Haven Appeal?

Trump’s August 1 tariff implementation and potential 10% BRICS penalties create policy uncertainty while strong economic data reduces safe-haven appeal.

Profit-taking pressure from recent gains combines with reduced geopolitical risk appetite as stock markets rebound.

Goldman Sachs acknowledges downside risks from potential central bank demand drops and scenarios where resilient economic growth prompts Fed rate hikes, creating unfavorable conditions for gold.

More Information in our Economic Calendar.