The U.S. dollar index reversed early losses to trade 0.3% higher, directly undermining gold’s appeal for non-dollar buyers. The uptick in the greenback coincided with Trump rolling back his threat of fresh tariffs on the EU. Instead of escalating tensions, he reinstated a July 9 deadline for trade talks, which fueled optimism in equity markets and weakened gold’s haven bid.

Ole Hansen of Saxo Bank noted that gold is under pressure from technical selling, with the metal trading below a descending trendline drawn from the April all-time high. “Reduced haven demand and rising stock markets are weighing on gold,” he said. This backdrop of declining geopolitical stress and a firmer dollar creates immediate resistance at Friday’s high of $3366.02, with downside pivots marked at $3310.48 and $3277.91.

Fed Speeches and Inflation Data Could Set the Next Move

Market focus is now shifting to upcoming speeches from Federal Reserve officials and Friday’s release of core PCE inflation data — a key input for rate decisions. Investors currently expect 47 basis points of rate cuts by year-end, likely beginning in October. A weaker inflation print or dovish commentary could reignite support for gold, as lower rates reduce the opportunity cost of holding non-yielding assets like bullion.

Rhona O’Connell of StoneX emphasized that gold remains in a consolidation phase. “The high is likely in, but uncertainty will keep prices supported,” she noted. Still, the technical structure suggests caution, particularly as price action nears the 50-day moving average.

Gold Prices Forecast: Test of Key Support May Define Bullish Structure