Expectations of a Fed rate cut are rising, and gold prices are once again testing the dense pressure range, waiting for a breakthrough
2025-08-04 13:24:44
A stronger dollar put pressure on gold prices, but expectations of interest rate cuts limited its rebound.
Gold prices retreated from a one-week high of around $3,369 hit in Asian trading on Monday and are now trading around $3,340. The dollar index was supported by a rebound in U.S. Treasury yields, partially offsetting the decline triggered by weak non-farm payroll data last Friday.
However, as the market generally expects the Federal Reserve to start a rate cut cycle in September, the dollar rebound lacks sustained momentum and its effect on suppressing gold prices is relatively limited.
The July non-farm payroll data released on Friday showed only 73,000 new jobs added, far below the expected 110,000. Meanwhile, the May and June figures were significantly revised downward. The unemployment rate rose to 4.2%, and the labor force participation rate fell slightly to 62.2%, reflecting a continued cooling of the US labor market.
"President Trump immediately fired the director of the Bureau of Labor Statistics after the release of the employment data, which led to the resignation of Federal Reserve Board Director Kugler. The market began to question whether the Federal Reserve can maintain its policy independence." This move may prompt more safe-haven funds to flow into the gold market.
US President Trump ordered the deployment of two nuclear submarines near Russian waters in response to former Russian President Dmitry Medvedev's tough stance, further exacerbating global uncertainty. "This could trigger the risk of escalating geopolitical conflicts on a larger scale, thereby strengthening gold's safe-haven properties."
From the technical chart, gold prices maintained a short-term bullish pattern after breaking through the key level of $3,335 last Friday and stabilizing above the 100-day moving average on the 4-hour chart.
If gold prices fall below the above-mentioned moving average, it may attract buying intervention in the $3,320 area, and further support is at the $3,300 mark. This position is the medium-term bull-bear watershed, and if it falls through, the bears tend to dominate.
On the contrary, if the gold price breaks through $3,370 again, it will open up upward space to test the $3,400 mark. If the momentum continues, it will look up to the previous high resistance area of $3,430, and even challenge the historical high of $3,500.
Editor's opinion:
Currently, the price of gold is suppressed by the short-term rebound of the US dollar, but the multiple supporting factors behind it remain strong: expectations of a September rate cut by the Federal Reserve continue to strengthen, concerns about the stability of monetary policy, and geopolitical uncertainty increase demand for safe-haven assets.
Technically, the bullish trend remains. As long as gold prices do not fall below the $3,300 support level, bulls may still be able to challenge the highs again. In the near term, focus will be on US factory orders data and market risk sentiment.
Gold prices retreated from a one-week high of around $3,369 hit in Asian trading on Monday and are now trading around $3,340. The dollar index was supported by a rebound in U.S. Treasury yields, partially offsetting the decline triggered by weak non-farm payroll data last Friday.
However, as the market generally expects the Federal Reserve to start a rate cut cycle in September, the dollar rebound lacks sustained momentum and its effect on suppressing gold prices is relatively limited.
The July non-farm payroll data released on Friday showed only 73,000 new jobs added, far below the expected 110,000. Meanwhile, the May and June figures were significantly revised downward. The unemployment rate rose to 4.2%, and the labor force participation rate fell slightly to 62.2%, reflecting a continued cooling of the US labor market.
"President Trump immediately fired the director of the Bureau of Labor Statistics after the release of the employment data, which led to the resignation of Federal Reserve Board Director Kugler. The market began to question whether the Federal Reserve can maintain its policy independence." This move may prompt more safe-haven funds to flow into the gold market.
US President Trump ordered the deployment of two nuclear submarines near Russian waters in response to former Russian President Dmitry Medvedev's tough stance, further exacerbating global uncertainty. "This could trigger the risk of escalating geopolitical conflicts on a larger scale, thereby strengthening gold's safe-haven properties."
From the technical chart, gold prices maintained a short-term bullish pattern after breaking through the key level of $3,335 last Friday and stabilizing above the 100-day moving average on the 4-hour chart.
If gold prices fall below the above-mentioned moving average, it may attract buying intervention in the $3,320 area, and further support is at the $3,300 mark. This position is the medium-term bull-bear watershed, and if it falls through, the bears tend to dominate.
On the contrary, if the gold price breaks through $3,370 again, it will open up upward space to test the $3,400 mark. If the momentum continues, it will look up to the previous high resistance area of $3,430, and even challenge the historical high of $3,500.
Editor's opinion:
Currently, the price of gold is suppressed by the short-term rebound of the US dollar, but the multiple supporting factors behind it remain strong: expectations of a September rate cut by the Federal Reserve continue to strengthen, concerns about the stability of monetary policy, and geopolitical uncertainty increase demand for safe-haven assets.
Technically, the bullish trend remains. As long as gold prices do not fall below the $3,300 support level, bulls may still be able to challenge the highs again. In the near term, focus will be on US factory orders data and market risk sentiment.
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- The market involves risk, and trading may not be suitable for all investors. This article is for reference only and does not constitute personal investment advice, nor does it take into account certain users’ specific investment objectives, financial situation, or other needs. Any investment decisions made based on this information are at your own risk.
