Gold News: Market Faces Bearish Outlook as Safe-Haven Demand Weakens

Lower as Trade Optimism and Strong Dollar Weigh on Safe-Haven Demand

Gold prices edged lower on Tuesday, extending recent weakness as easing U.S.-China trade tensions and a mild dollar rebound dented demand for the safe-haven metal. Although the market remains rangebound in the short term, key technical levels and a packed U.S. data calendar this week could trigger a decisive move.

At 12:03 GMT, XAU/USD is trading $3307.66, down $36.21 or -1.08%.

Gold Stuck in Range With Key Technical Levels in Focus

XAU/USD continues to trade within a tight consolidation zone, currently capped by 50% Fibonacci resistance at $3380.20 and underpinned by support at $3228.38. A break above the $3380.20 level would shift focus back toward the all-time high near $3500.20.

On the downside, gold remains vulnerable to further selling pressure if it drops below $3164.23, with the 50-day moving average at $3067.67 providing deeper support. This moving average has supported the uptrend since early January.

Trade Optimism Dampens Gold’s Appeal

Investor sentiment was buoyed by renewed optimism around trade negotiations. U.S. Treasury Secretary Scott Bessent stated several major trading partners, including India and Japan, had made “very good” proposals to avoid new tariffs.

He added that one of the first bilateral trade deals may be signed with India. Meanwhile, China signaled a more conciliatory stance by exempting certain U.S. goods from retaliatory tariffs. This de-escalation tone pressured gold, as traders rotated out of safe-haven assets.

Dollar Rebound and Data Anticipation Add to Pressure

The U.S. dollar staged a modest recovery on the back of improved risk sentiment and potential de-escalation in trade tensions, further weighing on gold.

Traders are now turning their attention to key U.S. macro data this week, including thePCE price index and Friday’s non-farm payrolls. These releases could provide clarity on the Federal Reserve’s interest rate stance, and any hawkish tilt would likely cap gold upside in the near term.

Gold Imports from China Point to Underlying Physical Demand

Despite the bearish tilt in sentiment, physical demand remains supportive. Hong Kong data showed China’s gold imports jumped 41.9% in March from February, signaling underlying demand strength from the world’s largest consumer.

Gold Prices Projection: Bearish Near-Term Outlook

While long-term fundamentals such as central bank buying and structural diversification remain intact, the near-term outlook for gold is bearish. The combination of easing geopolitical stress, a firmer dollar, and upcoming U.S. economic data is likely to pressure gold toward its support band.

A breach below $3164.23 could trigger accelerated downside toward the 50-day moving average near $3067. Until bulls reclaim $3380.20, rallies are likely to face selling pressure.

More Information in our Economic Calendar.