XAU/USD Current price: $3,343.30
- Market players await first-tier events for additional directional clues.
- US President Donald Trump to meet his Russian counterpart this week.
- XAU/USD pressures intraday lows in the $3,340 area, aiming to extend its slide.
Spot Gold is down on Monday, trading at its lowest in a week, just below the $3,350 mark. The bright metal fell throughout the day, despite some modest caution leading the financial board. The decline accelerated in the mid-European session and extended into American trading hours amid resurgent demand for the US Dollar (USD).
Speculative activity, however, is limited amid the absence of big news and ahead of upcoming first-tier events. On the data front, the Reserve Bank of Australia (RBA) will announce its decision on monetary policy on Tuesday. The central bank is widely anticipated to trim the Official Cash Rate (OCR) by 25 basis points, while market players will look for clues on the next move. The United States (US) will then publish the July Consumer Price Index (CPI), with the index expected to indicate inflationary pressures have ticked higher.
Other than that, US President Donald Trump had a busy start to the week. He referred to China as the deadline to reach an agreement with its major commercial partner looms. Both countries have imposed on each other massive tariffs of three digits, but ultimately paused most of them to reach a better deal. Such levies should come into effect on Tuesday, unless they announce an extension of the truce. Meanwhile, Trump announced he “hopes” China quadruples its soybean demand amid a shortage in the Asian giant.
Additionally, Trump is expected to meet Russian President Vladimir Putin later this week, to negotiate the end of the war between Moscow and Ukraine. Trump has recently punished Russian oil buyers with tariffs to put pressure on Putin.
Generally speaking, financial markets started the week with cautious optimism. Asian stocks edged higher, while European ones closed the day mixed. As for Wall Street, the Dow Jones Industrial Average (DJIA) trades in the red, but the Nasdaq Composite and the S&P500 hold on to gains.
XAU/USD short-term technical outlook
From a technical point of view, the daily chart for the XAU/USD pair shows it is currently trading below a flat 20 Simple Moving Average (SMA), while a bullish 100 SMA loses momentum at around $3,290, providing dynamic support should the decline continue. In the meantime, technical indicators crossed their midlines into negative territory with firm downward slopes, reflecting the ongoing downward pressure and hinting at lower lows ahead.
The near-term picture is bearish, given that technical indicators fell well below their midlines, maintaining their downward slopes and with the Relative Strength Index (RSI) indicator approaching oversold readings. At the same time, the XAU/USD pair fell below its 20 and 100 SMAs, with the shorter one gaining downward traction at around $3,378. Finally, Gold is finding some near-term support in a directionless 200 SMA. A clear break below the latter should open the door for a bearish extension in the upcoming sessions.
Support levels: 3.338.60 3,312.25 3,290.00
Resistance levels: 3,356.10 3,372.30 3,389.85
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