Gold Holds $3,330 as Traders Brace for Tariffs, Fed Cut, and NFP Shock

Gold Price (XAU/USD) Firms Above $3,300 As Dollar Tumbles, Traders Brace for Trump’s July 9 Tariff Shock

XAU/USD Recovers From Monthly Lows as Geopolitical Risk and Rate Cut Bets Drive Safe-Haven Flow

The price of gold (XAU/USD) is regaining bullish momentum, trading firmly above $3,330 in early July 2025 as markets brace for Trump’s July 9 tariff deadline and intensifying bets on a Federal Reserve rate cut in September. Tuesday’s trading session showed resilience after a sharp rebound from monthly lows near $3,240, with buyers defending support at the 50-day Simple Moving Average (SMA) around $3,320, while spot gold opened at $3,315.70, up 0.7% from the prior day.

Investors are repositioning aggressively as macro uncertainty intensifies. The US Dollar Index (DXY) fell to its weakest level since February 2022, dragged by rising fiscal concerns and weaker-than-expected consumer spending. Fed Chair Jerome Powell acknowledged in Sintra that inflation has moderated and that without the tariff-induced inflation premium, rates may already be lower. Traders now price in a 77% probability of a rate cut in September. This dovish backdrop—combined with geopolitical instability and a legislative impasse around Trump’s $3.3 trillion “One Big Beautiful Bill”—continues to anchor safe-haven demand for gold.

Geopolitical Tensions and Trade Wars Stoke Gold Demand as Middle East Fragility Lingers

The ceasefire between Israel and Iran remains tenuous, with both sides accused of violating terms. The lack of concrete diplomatic progress has reintroduced geopolitical risk into the market, with traders aggressively hedging exposure through precious metals. Simultaneously, Trump’s hardline trade rhetoric has reignited fears of a global trade war, with White House officials hinting tariffs could rise from 10% to as high as 50% unless nations comply with new reciprocal trade demands.

So far, only the United Kingdom has signed a deal, leaving the European Union, Japan, and India in limbo. U.S. Treasury Secretary Scott Bessent reiterated that without concessions, penalties would kick in automatically. Gold’s safe-haven status is further boosted by skepticism around the Senate’s ability to pass the “Beautiful Bill,” with deficit projections now exceeding prior estimates.

Technical Outlook: XAU/USD Faces Resistance at $3,350–$3,370, But Bulls Hold Momentum

Technically, gold is pressing against key resistance at $3,350, and a decisive close above this level could open upside to $3,368–$3,370, followed by the psychological $3,400 level. Beyond that, bulls would eye the $3,450–$3,500 range—the April highs and all-time peak. On the downside, firm support sits near $3,297 (38.2% Fibonacci of the April rally) and $3,270, with further downside risk toward $3,244, and then the 100-day SMA at $3,168.

Momentum indicators are recovering from oversold conditions. The 14-day RSI remains below 50, signaling caution, while the ADX around 12 reflects a neutral trend awaiting directional confirmation. However, if bulls can consolidate above $3,320, the momentum may strengthen and break the recent downtrend structure.

Macro Risk Map: Fed Easing Odds, Fragile Labor Data, and Fiscal Expansion Feed XAU/USD Strength

Friday’s Nonfarm Payrolls (NFP) report is now the key macro trigger. Last month’s weak Personal Consumption Expenditures (PCE) data and Powell’s tone have set the stage for soft labor numbers to lock in easing. The market reaction is tied closely to fiscal uncertainty: the “Beautiful Bill” is estimated to widen the deficit by $3.3 trillion over the next decade. That’s forced traders to hedge against debt-driven inflation and Fed inaction by rotating into gold.

Meanwhile, investor flows suggest strategic rotation. According to industry data, physical gold ETFs added nearly 12 metric tons last week—the strongest inflow since May—as institutional investors offload equity risk. HSBC also lifted its 2025 gold price forecast from $3,015 to $3,215, citing heightened central bank demand and macro instability. Goldman Sachs reiterated its $3,700 year-end target, contingent on further tariff escalation and global monetary easing.

Final Verdict: XAU/USD Bullish Bias Intact – Buy the Dips into $3,300 Support

The combination of dovish Fed guidance, elevated geopolitical tensions, rising fiscal deficits, and technical momentum points toward continued strength in XAU/USD. With the tariff decision on July 9, the NFP report, and Powell’s next speech all clustered into the same week, the yellow metal is positioned for potential breakout volatility. As long as $3,297–$3,300 holds, the setup favors bullish continuation toward $3,370, with upside potential to $3,400–$3,450 in the short term.

Gold (XAU/USD): Buy

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