Gold Daily | Gold Falls 0.4% Amid Eased U.S.-China Tensions and Anticipated Fed Rate Cuts

【Latest Gold Price and Recent Trends】

Gold prices are currently down by 0.4%, trading near $3,233. The recent easing in U.S.-China trade tensions has reduced global recession concerns and increased investor risk appetite, leading to a decline in gold's appeal as a safe haven asset. Last month, due to heightened trade war worries, gold hit a record high of $3,500.05.

【Technical Analysis】

Gold prices are under bearish pressure, moving below the 21-day SMA at $3,313. If this level holds, further downside is expected. The 14-day RSI is below the midpoint, indicating downward pressure. The next support is at $3,100 and $3,072. A breakout above the 21-day SMA could lead to testing the resistance at $3,430 and potentially retesting $3,500. Short-term support lies at $3,225, with potential for further selling if this is breached.

【Market Sentiment and Economic Background】

Global equities have shown strength amidst easing U.S.-China trade tensions and moderate U.S. inflation data. With the expectation of Federal Reserve rate cuts, particularly after April's CPI data came in lower than expected, gold's traditional appeal as an inflation hedge is lessened. The market anticipates up to a 53 basis point rate cut from the Fed starting in September.

【Analyst Opinions】

Saxo Bank's Ole Hansen noted that the tariff truce announcement has led to a stock market rally and weakened gold's safe haven appeal. StoneX's Rhona O'Connell mentioned potential for a "double top" technical pattern if prices fall below $3,199, suggesting more downside risk. However, the supportive fundamentals are expected to prevent significant declines. Citibank has revised its 3-month gold price target down to $3,150, anticipating consolidation after recent gains.