Gold extended its rally for a sixth straight session on Tuesday, marking a fresh record high during the Asian session as investors continued to price in a Federal Reserve rate cut this month. Softer policy expectations, alongside lingering tariff uncertainty and escalating geopolitical tensions, kept demand strong for the safe-haven metal.
That said, XAU/USD faced difficulty in sustaining momentum above the $3,500 psychological level as a modest U.S. Dollar rebound capped further upside. Overbought technical conditions also prompted caution, with many traders choosing to stay on the sidelines ahead of this week’s key U.S. economic releases, including Friday’s Nonfarm Payrolls (NFP).
Daily Market Drivers
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Fed expectations: Markets remain confident the Fed will ease policy in September, underpinning bullion’s six-day winning streak.
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Political pressure: U.S. Treasury Secretary Scott Bessent defended President Trump’s dismissal of Fed Governor Lisa Cook amid fraud allegations. Trump also criticized Chair Powell for delaying rate cuts, fueling concerns over Fed independence.
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Tariff uncertainty: A federal appeals court recently ruled Trump’s reciprocal tariffs illegal, with the case now likely headed to the Supreme Court, adding market volatility.
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Geopolitical risks: Escalating conflicts in Ukraine and the Middle East reinforced gold’s safe-haven appeal.
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U.S. data ahead: ISM Manufacturing PMI, JOLTS job openings, ADP employment, ISM Services PMI, and Friday’s NFP will be closely watched for policy guidance.
Technical Outlook
Gold’s breakout above the $3,440 resistance zone—capping a three-month trading range—was a decisive bullish signal. However, failure to secure acceptance above $3,500 and an overbought RSI suggest near-term consolidation or a pullback is likely.
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Immediate support: $3,475–$3,474 (session low).
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Key pivot: $3,440 (former range top, now strong support).
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Deeper support: $3,410–$3,400 if $3,440 breaks.
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Upside target: Sustained strength above $3,500 could open the door toward $3,530–$3,550.
Trading bias: While the long-term outlook remains bullish, chasing fresh longs above $3,500 appears risky without a corrective dip. A pullback toward $3,440–$3,475 may offer better risk-reward opportunities for buyers.
