Gold Price Forecast Summary

Published: July 4, 2025

Author: James Hyerczyk

Key Highlights

• Gold prices are experiencing a rebound, supported by a weakening U.S. dollar and increased safe-haven demand ahead of tariff discussions.
• The dollar index has declined for two consecutive weeks, making gold more accessible to international buyers.
• Market sentiment is influenced by President Trump's tax cuts and ongoing fiscal uncertainties, which bolster gold's appeal as a safe asset.

Market Dynamics

Gold prices are poised for a weekly gain as traders shift focus to safe-haven assets due to the impending July 9 tariff deadline associated with President Trump's trade policies. The dollar index (.DXY) has decreased by 0.2%, marking its second weekly decline, which enhances gold's attractiveness for holders of other currencies.

According to Ricardo Evangelista from ActivTrades, the uncertainty surrounding the U.S. fiscal situation post-tax cuts and tariff negotiations is driving demand for gold. Trump's administration is transitioning to a broader tariff strategy, which has heightened market caution.

Impact of Tax Cuts and Job Data

Trump's tax-cut legislation has been finalized, making significant tax reductions permanent and introducing new tax breaks. This has led to increased scrutiny of the fiscal landscape, with traders concerned about the long-term budget implications, further supporting gold prices.

Recent U.S. nonfarm payroll data for June showed unexpected growth, but much of this was attributed to government hiring, with private sector job growth lagging. This mixed economic data complicates the Federal Reserve's outlook on interest rates, as noted by Giovanni Staunovo from UBS.

Technical Analysis

Gold is currently trading within a narrow range, with resistance identified at $3347.97 and support near the 50-day moving average at $3321.80. This tight trading band suggests investor indecision, setting the stage for potential volatility as the July 9 tariff deadline approaches.

The ongoing weakness of the dollar and the safe-haven demand related to trade uncertainties are expected to support gold prices in the near term. Traders are advised to monitor price movements around the $3348 resistance level, as a breakout could indicate renewed bullish momentum.

Outlook

The outlook for gold remains bullish as long as it stays above the key support level of $3321.80. A close above the resistance at $3347.97 could lead to further gains, while a failure to maintain above the 50-day moving average may result in short-term retracements. The current market conditions favor buying on dips, particularly in light of the dollar's decline and the cautious sentiment surrounding the upcoming tariff discussions.

Conclusion

In summary, gold is positioned to benefit from a combination of dollar weakness, safe-haven demand, and fiscal uncertainties. Traders should remain vigilant as market dynamics evolve leading up to the tariff deadline.