Copper prices are under strong positive pressures, which allows it to surpass the barrier at $5.1000, to notice forming a strong bullish rally and achieving big gains by hitting $5.8100 level, forming an intraday rebound to $5.5500 to catch its breath and gather some gains.
Note that the price is surrounded by several positive factors that support the continuation of the positivity, such as the unionism of the main indicators by providing positive momentum besides forming extra support at $5.3200 level, which makes us prefer more of the bullish attempts that target 2.00%Fibonacci extended level at $5.9720, to approach from the resistance of the main bullish channel that appears in the above image.
The expected trading range for today is between $5.4500 and $5.9800
Gold price licks its wounds early Wednesday after breaking the range to the downside.
Trade deals optimism and a hawkish shift in Fed expectations remain a drag on the non-yielding Gold price.
Gold price settles Tuesday below 50-day SMA, with a bearish daily RSI in play.
Gold price is battling $3,300, licking its wounds early Wednesday. Traders refrain from placing fresh bets on the bright metal, awaiting fresh trade updates and the Minutes of the US Federal Reserve (Fed) June policy meeting for fresh directives.
Gold price eyes trade talks, Fed Minutes
Following Tuesday’s over 1% decline, Gold price is nursing losses in Asian trading on Wednesday, unable to find much inspiration from mixed Chinese inflation data for June.
Data on Wednesday showed that China’s annual Consumer Price Index (CPI) rose 1% in June after falling 0.1% in May. Meanwhile, the nation’s Producer Price Index (PPI) dropped by 3.6% over the year in June versus -3.2% expected and -3.3% previous.
Investors continue to digest US President Donald Trump’s tariff talks, with the renewed optimism over likely US trade deals lending some support to the US Dollar (USD), capping the Gold price recovery attempts.
Trump extended the ‘reciprocal tariffs’ deadline until August 1, allowing some of the US trade partners more time for trade negotiations and reaching a deal. This narrative continues to float the boat for the Greenback at the expense of the USD-denominated Gold price.
Meanwhile, trade war re-ignited as Trump threatened 25%-40% tariffs on 12 countries and 10% additional levies on all BRICS nations, including India, effective August 1.
“The lingering threat to inflation from tariffs will probably persuade the Fed to hold off cutting interest rates until next year, and this will put a lid on Gold prices,” Reuters reported, citing Hamad Hussain, climate and commodities economist at Capital Economics.
However, markets remain wary about a trade stand-off between the US and Japan and the US and South Korea, while taking account of Trump’s latest tariff announcement of 50% on Copper imports to take effect within 30 months.
Further, the US President said on social media that there would be announcements on Wednesday regarding “a minimum of 7 countries having to do with trade,” without specifying whether he would be announcing new deals or tariff letters.
Alongside trade talks, the Fed’s June meeting Minutes also take center stage this Wednesday, with markets looking forward to fresh hints on the timing of the next interest rate cut, given the heightened uncertain environment due to Trump’s tariffs.
Markets are now pricing in a 61% chance that the Fed will lower rates in September, down from about 73% seen a week ago, the CME Group’s FedWatch Tool shows.
Gold price technical analysis: Daily chart
Gold price broke the recent range to the downside after piercing through the 50-day Simple Moving Average (SMA) at $3,322 on a daily closing basis on Tuesday.
The 14-day Relative Strength Index (RSI) found foothold below the midline in the bearish territory, currently near 44.50, suggesting that the tide has clearly turned in favor of Gold sellers.
Therefore, a sustained move below the 38.2% Fibonacci Retracement (Fibo) level of the April record rally at $3,297 is critical to extending the latest leg south toward the monthly low of $3,248.
The last line of defense for buyers is seen at the 50% Fibo support at $3,232.
Alternatively, any recovery attempts need acceptance above the 21-day SMA at $3,346.
Further up, the 23.6% Fibo level of the same advance at $3,377 could offer stiff resistance to Gold buyers.
The next topside hurdle is seen at the $3,400 threshold.
Economic Indicator
FOMC Minutes
FOMC stands for The Federal Open Market Committee that organizes 8 meetings in a year and reviews economic and financial conditions, determines the appropriate stance of monetary policy and assesses the risks to its long-run goals of price stability and sustainable economic growth. FOMC Minutes are released by the Board of Governors of the Federal Reserve and are a clear guide to the future US interest rate policy.
The GBPJPY pair kept its positive stability above 66%Fibonacci correction level, to form a strong support at 198.80, resuming the rise and achieving new gains by reaching 199.80 level, approaching from the initial extra target at 200.35.
The continuation of stochastic fluctuation with the overbought level might push the price to target 200.35 level, which forces it to provide mixed trading until gathering the required extra positive momentum for achieving extra gains that might extend to 200.85 reaching the next main target at 201.55.
The expected trading range for today is between 199.00 and 200.35
Copper price attempted to surpass stochastic negativity by its stability yesterday above $4.9000 level, which forms 68.00%Fibonacci correction level, to reinforce its stability within the bullish channel’s levels, extending its support to $4.8400.
Note that the continuation of the main indicator’s contradiction might push the price to provide weak sideways trading, but the bearish correctional suggestion will remain valid, depending on the stability of the barrier at $5.1000, to expect testing the bullish channel’s support, then monitor its behavior to detect the expected trend on the upcoming trading.
The expected trading range for today is between $4.8650 and $5.0000
Trend forecast: Fluctuated within the bullish track
Bearish behavior today confirms a lower swing high on the daily chart from last Thursday. A lower swing high could lead to a lower swing low. Last week a higher swing low was established at $3,247. However, there is also an interim swing low from late May at $3,245. So, a decline below the lower price level would indicate a failure of support at those two swing lows. If that occurs, then selling pressure may intensify as it would signal likely further weakness as the near-term uptrend losses momentum.
Bullish Above $3,366
Nevertheless, an upside breakout above last week’s high of $3,366 will trigger a bullish reversal in gold. Both a weekly high will be reclaimed, plus a short downtrend line and 20-Day MA, now at $3,349. Although the uptrend has been testing dynamic support recently and it continues to do so, the near-term bull trend, starting from the November swing low, remains dominant unless there is a drop below $3,245. Key resistance for gold is at the June lower swing high of $3,451. But before that swing high is challenged an interim swing high at $3,396 needs to be exceeded.
Pennant Consolidation Not Complete
Another way of considering the consolidation pattern that has been forming for several months is that it is a large bull pennant pattern. The boundaries of the pennant are marked with purple lines on the chart. It shows that gold could continue to consolidate within the pennant for an estimated two or three more weeks before it may be ready to break out.
For a look at all of today’s economic events, check out our economic calendar.
If natural gas retains a pattern of higher swing lows, the uptrend has a chance of being sustained. Although a lower rising channel line has failed to retain support, there is a longer trendline slightly below Monday’s low of $3.28. A failure of support at the lower trendline opens the door to a 78.6% retracement target of $3.13 and an initial target for a falling ABCD pattern at $2.97. That price area may have some significance as it is also marked by an AVWAP price level at $2.95 currently.
The indicator is anchored at the February 2024 trend low, so it has long-term significance. However, it was also confirmed twice as support. Recently, the swing low in April found support at the AVWAP line (light blue) and earlier in October 2024. Since the ABCD target and AVWAP indicators point to a similar potential support area, it could act as a magnet for price.
Above $3.47 Gets Buyers Interested
On the upside, a two-day bullish reversal will trigger on a rally above Monday’s high of $3.47. An interim lower swing high is the first target at $3.57. It is followed by a lower swing high at $3.75. A sustained advance above $3.75 is needed before natural gas shows strength that could lead to a challenge of recent trend highs at $4.15.
For a look at all of today’s economic events, check out our economic calendar.
Trump’s tariffs, ranging between 25% and 40% from August 1, threaten to revive trade tensions that could weigh on global growth. China has warned it will retaliate against nations aligning with U.S. supply chain strategies, adding geopolitical risk but failing so far to trigger a gold breakout.
UBS analyst Giovanni Staunovo noted that the tariff extensions are gold-negative while potential damage to Asian growth prospects remains gold-supportive, leaving traders with conflicting signals.
Federal Reserve Minutes Could Be the Trigger Traders Need
The market is now eyeing the Fed’s June meeting minutes on Wednesday for clues on interest rate policy, with traders searching for any dovish tilt that could weaken the dollar and lower yields, providing room for gold to rally.
Currently, Trump’s tariffs have fueled inflation concerns that complicate the Fed’s rate path, but without clear signals on policy easing, gold remains pinned in its current zone.
Treasury Yields and Gold Prices Remain Entangled
Rising Treasury yields, driven by renewed tariff threats, are creating headwinds for gold prices as the cost of holding bullion increases relative to yield-bearing assets. The 2-year yield remains stable near 3.907%, while long-end rates are inching up, adding pressure on gold unless inflation fears escalate significantly.
Gold Prices Forecast: Range Holds Until Catalyst Arrives
Gold price loses momentum to around $3,330 in Tuesday’s Asian session.
Trump unveiled new tariff rates, still open to additional trade negotiations.
The downside for yellow metal might be limited as central banks worldwide continue to buy gold.
The Gold price ( XAU/USD) trades in negative territory near $3,330 during the Asian trading hours on Tuesday, pressured by a firmer US Dollar (USD). The precious metal edges lower on easing trade tension after US President Donald Trump announced an extension to the upcoming tariff deadline and suggested that he was still open to additional negotiations.
Market concerns eased after Trump hinted at the possibility of an additional trade deal and delays of the tariff deadline. Trump further stated that the August 1 deadline was “not 100% firm,” signaling he remained open to continuing to tweak the rates. Optimism surrounding Trump’s tariff policies lifts the Greenback and weighs on the USD-denominated commodities price, as a firmer USD makes Gold more expensive for foreign buyers.
Gold traders will closely monitor further announcements in the White House’s trade negotiations. Any signs of renewed trade tensions and fears of a global trade war could boost the safe-haven flows, benefiting the Gold price.
Furthermore, rising major central banks’ gold buying might contribute to the yellow metal’s upside. According to a new report from the World Gold Council (WGC), global central banks have picked up on buying gold in May compared to other months. China’s central bank also added gold to its reserves in June for the eighth month in a row, official data from the People’s Bank of China (PBOC) showed on Monday.
“The PBoC in particular has been diversifying foreign exchange reserves substantially and an uptick in uncertainty and geopolitical risk may speed up the process,” said Zain Vawda, analyst at MarketPulse by OANDA.
Gold FAQs
Gold has played a key role in human’s history as it has been widely used as a store of value and medium of exchange. Currently, apart from its shine and usage for jewelry, the precious metal is widely seen as a safe-haven asset, meaning that it is considered a good investment during turbulent times. Gold is also widely seen as a hedge against inflation and against depreciating currencies as it doesn’t rely on any specific issuer or government.
Central banks are the biggest Gold holders. In their aim to support their currencies in turbulent times, central banks tend to diversify their reserves and buy Gold to improve the perceived strength of the economy and the currency. High Gold reserves can be a source of trust for a country’s solvency. Central banks added 1,136 tonnes of Gold worth around $70 billion to their reserves in 2022, according to data from the World Gold Council. This is the highest yearly purchase since records began. Central banks from emerging economies such as China, India and Turkey are quickly increasing their Gold reserves.
Gold has an inverse correlation with the US Dollar and US Treasuries, which are both major reserve and safe-haven assets. When the Dollar depreciates, Gold tends to rise, enabling investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rally in the stock market tends to weaken Gold price, while sell-offs in riskier markets tend to favor the precious metal.
The price can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can quickly make Gold price escalate due to its safe-haven status. As a yield-less asset, Gold tends to rise with lower interest rates, while higher cost of money usually weighs down on the yellow metal. Still, most moves depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAU/USD). A strong Dollar tends to keep the price of Gold controlled, whereas a weaker Dollar is likely to push Gold prices up.
Copper price attempted to surpass stochastic negativity by its stability yesterday above $4.9000 level, which forms 68.00%Fibonacci correction level, to reinforce its stability within the bullish channel’s levels, extending its support to $4.8400.
Note that the continuation of the main indicator’s contradiction might push the price to provide weak sideways trading, but the bearish correctional suggestion will remain valid, depending on the stability of the barrier at $5.1000, to expect testing the bullish channel’s support, then monitor its behavior to detect the expected trend on the upcoming trading.
The expected trading range for today is between $4.8650 and $5.0000
Trend forecast: Fluctuated within the bullish track
Although the relationship to the 200-Day MA carries more weight than the trendline, it is not yet clear whether today’s low will be established as a swing low. The low for the day was very close to the next lower trendline. It looks like that line may continue to take precedence over the rising line that recently crossed above the 200-Day MA and was shown as resistance today. This might mean there could be two or a few days of consolidation around the confluence of the next lower uptrend line, the 61.8% Fibonacci retracement at $3.51, and the 200-Day MA.
Relative Price Pattern
The relationship of the price of natural gas to the 200-Day MA is going to be key for finding clues in price behavior. If the 200-Day line fails to hold as a dynamic trend support area, then that would indicate that sellers dominate and therefore additional downside in prices could follow. The first sign of relative weaking would be on a daily closing price below the 200-Day MA, and that could happen today. At the time of this writing, trading has been occurring around the line could end Monday’s session either above or below the line.
Support at Risk but Holds Steady
Since October 2024 there have been only two instances where there was a daily closing price below the 200-Day MA. There were five days in April and then one day in May. In other words, natural gas remains in a support zone that could expand a little on the downside yet retain underlying buying pressure. A decisive daily close above the 200-Day line would show interest from buyers increasing. That would be for the short-term only, however, and further signs of strength would be needed to support a sustainable bullish reversal.
For a look at all of today’s economic events, check out our economic calendar.
