Gold Slips Below $3,400 as Focus Turns to US CPI Data.
XAU/USD slips as bullish momentum stalls near $3,400, with focus shifting to U.S. inflation data.
FUNDAMENTAL OVERVIEW:
Gold (XAU/USD) fell 1.2% to around $3,350 during Monday’s European session, pressured by selling as traders turned their attention to Tuesday’s U.S. CPI data for July. The report will help determine whether tariff-driven inflation is temporary or persistent, following June’s rise in import-heavy product prices.
Economists expect the headline CPI to rise 2.8% year-over-year and the core CPI to reach 3.0%. Stronger inflation could prompt markets to scale back expectations for a September Fed rate cut. The CME Fed Watch tool currently prices in an 88% probability of a 25-bps reduction to 4.00–4.25%.
While gold tends to perform well in high-inflation conditions, a prolonged restrictive Fed stance could weigh on the non-yielding metal.
Investors are also eyeing Friday’s planned meeting between U.S. President Donald Trump and Russian President Vladimir Putin to discuss potential steps toward ending the war in Ukraine.
GOLD TECHNICAL ANALYSIS CHART:
Technical Overview:
Gold is trading within an up channel.
Gold is moving below all the Moving Averages (SMA).
The Relative Strength Index (RSI) is in Buying Zone, while the Stochastic oscillator suggests Neutral trend.
Immediate Resistance level: 3377.00
Immediate support level: 3308.00
HOW TO TRADE GOLD
Following a strong rally, gold’s upward momentum stalled as prices faced resistance and reversed lower. The metal is now moving toward a key support zone. If this level holds and gold remains above it, the uptrend could resume.