Gold Price Pulls Back Slightly but Bullish Sentiment Persists

Image Credit: FXSTREET

Gold prices (XAU/USD) have eased slightly from the $2,758-2,759 range—marking their highest level since November 1—though they remain in positive territory for a third consecutive day during Wednesday’s early European session. The positive market sentiment, coupled with a rebound in US Treasury yields and a modest recovery in the US Dollar (USD) from its two-week low, has created headwinds for the precious metal.  

However, expectations that the Federal Reserve (Fed) will implement two rate cuts this year could limit gains in US bond yields and the USD, indirectly supporting the demand for gold as a non-yielding asset. Additionally, concerns over US President Donald Trump’s threatened tariffs are likely to sustain haven-driven inflows into gold, supporting its ongoing upward trend that has persisted for over a month.  

From a technical perspective, Tuesday's breakout above the $2,720 resistance zone served as a fresh catalyst for bullish traders. Daily chart oscillators remain in positive territory without approaching overbought conditions, indicating room for further gains. A sustained move beyond the $2,748-2,750 resistance could open the door for a push toward the all-time high of around $2,790, last reached in October 2024.  

Conversely, any corrective dip is likely to attract buyers near the $2,725-2,720 region. Below this, the next critical support is at $2,700-2,690, and a decisive break there could trigger intensified selling pressure, pulling gold prices down toward $2,660 and then the $2,625 area. The latter aligns with the 100-day Exponential Moving Average (EMA) and a rising trendline from November’s low, which is expected to act as a pivotal level for determining XAU/USD’s next significant move.

Paraphrasing text from "FXSTREET" all rights reserved by the original author.