Gold (XAUUSD) Price Forecast: Technical Pressure Builds as Gold Hugs 50-Day Average

Gold Steadies at 50-Day Moving Average as Fed Signals Dovish Turn and Geopolitical Risks Fade

Gold prices edged higher late Wednesday, trading narrowly around the 50-day moving average at $3325.10—a level that has influenced long-term direction since January. This marks the second consecutive session gold has hovered near this technical benchmark without breaking decisively, as traders brace for key U.S. economic data that could influence interest rate expectations.

At 19:08 GMT, XAU/USD is trading $3331.08, up $7.63 or +0.23%.

Middle East Ceasefire Cools Safe-Haven Interest in Gold

The recent ceasefire between Iran and Israel has softened safe-haven demand, easing geopolitical stress that had previously underpinned bullion. President Trump voiced optimism on a lasting resolution with Tehran, indicating that renewed diplomacy could prevent a restart of its nuclear program. This easing of tensions has removed a major driver for risk-off positioning, keeping gold capped despite a broadly supportive environment.

Dollar Index Struggles Below 50-Day Moving Average on Dovish Fed Signals

The U.S. Dollar Index (DXY) remains under pressure, unable to close above its 50-day moving average at 99.400. Tuesday’s high of 99.421 failed to break that ceiling, reinforcing resistance and exposing DXY to further downside. With the index drifting near support at 97.621, a breakdown could trigger deeper losses toward 95.137, especially as rate cut expectations firm.

Rate Cut Odds Grow as Powell Cites Contained Inflation

Federal Reserve Chair Jerome Powell reiterated in congressional testimony that the central bank remains cautious but would move on rate cuts if inflation stays contained. Markets interpreted his comments—and dovish remarks from Fed officials Bowman and Waller—as laying the groundwork for easing. A September cut is now priced in with over 85% probability, and futures are pricing in 60 basis points of cuts by year-end.

Gold Prices Forecast: Momentum Fails to Extend, Bears Regain Control

Gold’s recent upside breakout lacked staying power, with momentum fading well before a retest of the all-time high at $3500.20. The inability to sustain upward drive has prompted traders to fade rallies, reinforcing short-term bearish sentiment.

The 50-day moving average at $3325.10 remains a critical pivot level. If upcoming GDP, jobs, and PCE data do not significantly underwhelm expectations, gold may stay rangebound or push lower, with downside targets at $3228.28 and $3166.46. Analysts warn that without renewed geopolitical tension or a decisive dollar breakdown, gold could slide toward $2900 in the near term.

More Information in our Economic Calendar.