Gold Price Drops Toward $3,300 as US Dollar Strengthens on Fed and Trade News

Gold Falls as Stronger US Dollar Pressures Bullion Ahead of Fed and Trade News

XAU/USD Near $3,300 as Markets Digest Fed Signals and Global Trade Developments

Gold prices (XAU/USD) declined on Monday, sliding toward key triangle support near $3,300, as the US Dollar (USD) gained traction. The rally in the Greenback was fueled by hawkish Federal Reserve policy expectations and optimism surrounding potential trade agreements ahead of the July 9 tariff deadline.

US Dollar Strength and Fed Outlook Weigh on Gold

Following Friday’s Independence Day holiday, markets reopened with stronger trading volume and liquidity, helping solidify the Dollar’s gains.

The Nonfarm Payrolls (NFP) report released last Thursday showed robust job growth, reducing expectations for a July rate cut.
US Treasury yields rose in response, further supporting the USD and pressuring non-yielding assets like gold.

Trade Developments Remain in Focus

Investors remain cautious as they await updates on the US administration's trade negotiations. President Trump’s threats to impose tariffs on countries aligning with BRICS policies may offer downside protection for gold, but the near-term trend remains under pressure due to the stronger dollar and firm Fed stance.

“Gold typically underperforms in rising rate environments, and with the Fed looking more hawkish, bullion faces headwinds,” analysts at Tredu Research noted.

Technical Outlook: Triangle Support Near $3,300

Immediate support: $3,300
Next key support: $3,270
Resistance: $3,340 and $3,370
Pattern: Descending triangle

A break below the $3,300 level could accelerate bearish momentum unless geopolitical tensions or weak macro data reintroduce safe-haven demand.

Key Drivers to Watch This Week:

Fed meeting minutes release midweek
Tariff letters and trade deal announcements
Movements in US Treasury yields
Any BRICS-related geopolitical escalation

Stay updated with real-time market moves at Tredu.com/markets