Gold extended its short-term decline, breaking below its 20-day and 50-day simple moving averages (SMAs) after Fed Chairman Jerome Powell questioned the rationale for the July rate cut at a semi-annual congressional hearing last week. Moreover, recent U.S. data also supports this trend, with data showing signs of rising inflationary pressures and a pullback in initial jobless claims.
Nevertheless, the support trendline drawn from December 2024 still acts as a safety net around 3,270. As the July 9 tariff deadline approaches, key differences between the United States and its trading partners persist, which means that the agreement may take longer to finalize or a quick solution may leave key issues unresolved.
From a technical perspective, short-term risks remain skewed to the downside as momentum in the relative strength index (RSI) and the moving average convergence divergence indicator (MACD) weakens. The RSI hit a new low below the neutral 50 mark. If short pressure intensifies in the next few trading days, gold prices may retest the upper limit of the previous falling channel at 3,215, followed by the rising support line from October 2024 at 3,150. If it falls below this level, the decline may accelerate towards the psychological level of 3000, or even lower to 2970.
On the upside, if a strong catalyst pushes gold to rebound above the 20-day and 50-day moving averages (currently 3320-3350), the next resistance level may appear in the 3400-3435 range. A decisive close above this boundary may pave the way for gold prices to move towards 3500, or test resistance near 3530, and then may target the 3600 level.
Overall, despite the weakening technical indicators, gold has not completely lost its bullish reversal potential. As long as the price remains in a sideways structure above 3150, the downward pressure may still give rise to a "buy on dips" strategy.
XAUUSD GOLD XAUUSD GOLD XAUUSD GOLD
Nevertheless, the support trendline drawn from December 2024 still acts as a safety net around 3,270. As the July 9 tariff deadline approaches, key differences between the United States and its trading partners persist, which means that the agreement may take longer to finalize or a quick solution may leave key issues unresolved.
From a technical perspective, short-term risks remain skewed to the downside as momentum in the relative strength index (RSI) and the moving average convergence divergence indicator (MACD) weakens. The RSI hit a new low below the neutral 50 mark. If short pressure intensifies in the next few trading days, gold prices may retest the upper limit of the previous falling channel at 3,215, followed by the rising support line from October 2024 at 3,150. If it falls below this level, the decline may accelerate towards the psychological level of 3000, or even lower to 2970.
On the upside, if a strong catalyst pushes gold to rebound above the 20-day and 50-day moving averages (currently 3320-3350), the next resistance level may appear in the 3400-3435 range. A decisive close above this boundary may pave the way for gold prices to move towards 3500, or test resistance near 3530, and then may target the 3600 level.
Overall, despite the weakening technical indicators, gold has not completely lost its bullish reversal potential. As long as the price remains in a sideways structure above 3150, the downward pressure may still give rise to a "buy on dips" strategy.
XAUUSD GOLD XAUUSD GOLD XAUUSD GOLD 
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Senior Market Strategy Analyst | CFA® Charterholder | Builder of a Million Member Profit System. To join, please click 👉🚀🚀t.me/EagleEyePrecisionAnalysis
👉：t.me/Eagle_PreciseAnalysis
👉：t.me/Eagle_PreciseAnalysis
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.