Gold prices edged lower to $3,216 per ounce on Friday, with the primary drag came from the temporary easing in U.S.-China trade tensions, where both sides agreed to a 90-day rollback of tariffs. The move reassured markets that the broader economic fallout from prolonged protectionist measures may be avoidable, at least in the short term.
Further weighing on demand for gold, other global hotspots appear to be stabilising. The ceasefire between India and Pakistan is holding, while Russia-Ukraine peace efforts, though now stalling, have not reignited risk-off panic.
Bullion is now on track for a weekly loss exceeding 3%, retreating from a high of $3,252.23 earlier in the session.
However, the broader macroeconomic backdrop remains favourable for gold as the U.S. consumer inflation data came in soft, reinforcing expectations that the Federal Reserve will begin cutting interest rates likely twice before year-end. Traders are currently pricing in a total of 50 basis points of easing, beginning as early as July.
Still, Fed Chair Jerome Powell issued a note of caution during remarks this week, saying inflation could become more erratic going forward due to frequent supply-side disruptions. This could complicate central banks’ efforts to manage price stability, potentially reigniting gold’s appeal as a hedge against monetary policy uncertainty.
Gold prices initially extended their rebound, surging from a session low of 3120.81 to test resistance at 3252.23 before retreating. The strong upside move was supported by a bullish MACD crossover and upward momentum through the 5-, 10-, and 30-period moving averages on the 15-minute chart. However, the rally lost steam just below the 3260 mark, where sellers re-entered the market.
Picture: Gold jumps from $3120 to $3252 before paring gains, with momentum cooling near key resistance, as seen on the VT Markets app
Following the peak, bearish pressure set in, sending gold back below the 30-period MA and prompting a corrective pullback toward the 3215 area. The MACD histogram has flattened, and the signal lines are converging, suggesting the rally may be pausing. Immediate support lies around 3206, while resistance remains firm near 3250. A break below 3200 could open the door to 3180, whereas a bullish resurgence above 3252 would revalidate the uptrend.
With risk appetite improving and inflation pressures subdued, gold may struggle to regain bullish momentum in the immediate term. However, persistent geopolitical friction and shifting expectations around central bank policy remain key tailwinds. Any deterioration in trade talks or renewed inflation volatility could revive safe-haven flows, offering support above $3,160.
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