Gold (XAUUSD) Price Forecast: Overheated at $3,500? Reversal Watch in Focus

Gold Surges to $3,500 as Trump’s Attacks on Powell Stir Market Volatility

Gold extended its historic rally on Tuesday, briefly hitting a new all-time high at $3,500.20 per ounce before easing slightly. The latest move was sparked by renewed political pressure from former President Donald Trump on Federal Reserve Chair Jerome Powell, intensifying concerns over central bank independence and reinforcing safe-haven demand.

At 10:47 GMT, XAUUSD is trading $3453.91, up $29.68 or +0.87%.

No Resistance as Gold Rallies on Political Uncertainty

There is currently no technical resistance above current levels, leaving gold to trade vertically. Key support levels have adjusted higher with the pivot now at $3,228.38, while the 50-day moving average—considered the major support level—sits lower at $3,027.23. Traders are eyeing the potential for a closing price reversal top, which could trigger a short-term correction. However, the broader uptrend remains intact as long as buying strength continues to dominate market sentiment.

Trump’s Fed Criticism Weighs on Dollar, Boosts Bullion

The rally gained momentum after Trump sharply criticized Powell on social media, calling him a “major loser” and demanding immediate interest rate cuts. Trump argued that inflation is under control and suggested that without rate cuts, the U.S. economy could stall. These remarks pressured the U.S. dollar to fresh three-year lows and triggered a sharp 2.4% sell-off in equities—conditions typically favorable for gold.

No Forced Liquidation Despite Stock Sell-Off

Unlike previous sell-offs in equities, gold prices have not suffered from distressed liquidation or margin call selling. This signals firm conviction in bullion holdings, even as traders digest political risk and monetary policy uncertainty. The usual inverse correlation between stocks and gold has broken down temporarily, with bullion rising even as financial markets decline—underscoring its role as a hedge in times of stress.

Gold Prices Forecast

With political risk escalating and Fed policy under a microscope, gold remains well supported above $3,200. As long as buyers remain aggressive, and the dollar stays under pressure, the next psychological target is $3,600. Traders should watch upcoming Fed speeches closely for any hint of policy shifts, but for now, the trend remains firmly bullish.

More Information in our Economic Calendar.