Bank of America just raised its EUR/USD forecast
After reviewing the movements of gold futures in different time frames, I find that the looming trade tariff deadline is extending suspicion over the success of trade deals yet to be completed before August 1, as tariff-driven trade deals are typically dollar-friendly and lower the allure of gold amid rising risk appetite.
Undoubtedly, any further extension of this tariff deadline would only heighten suspicions about the intentions of the major trading partners of the U.S., who are reportedly considering de-dollarizing their economies to strengthen their currencies. This comes as they have already revised trade setups with Middle East countries to buy oil in their local currencies.
On the other hand, U.S. President Donald Trump’s idea behind these trade deals is only to strengthen the U.S. dollar by imposing higher tariffs on the trading partners on his terms and conditions.
Till now, the U.S. has completed trade deals with Japan and the European Union, while success is to be achieved on trade deals with Russia, China, Iran, and some other Middle Eastern countries.
However, this could attract new implications if the U.S. President doesn’t come forward with more accommodative trade policies before August 1 or provide some more time to achieve success on trade tariff deals with these countries, otherwise his whole concept of tariff trade deals, which mainly aims to strengthen the U.S. dollar, will be at stake.
As I have already explained the impact of looming uncertainty over trade tariff deadline in my last analysis https://www.investing.com/analysis/gold-strengthening-us-dollar-growing-trade-deals-optimism-could-trigger-selling-200664492 , and the gold futures are still trading in a narrow range as the investors are still clueless on Trump’s next move whether he will extend this deadline or not, and while making further trade deals with Russia, Iran and other countries, located in the Middle East to stop accepting local currencies to sell their oil.
Undoubtedly, if U.S. President Donald Trump steps back this time, the currently prevailing indecisiveness could extend, as reflected in the stagnant gold futures, which are reflecting indecisiveness before confirming the next directional move.
That is why, gold futures still facing stiff resistance this week, after a 4-day fall, found some support at the 50 DMA at $3366, bounced a little this Tuesday, facing stiff resistance at the $3389 while looking ready to move downward as the U.S. dollar Index futures are sustaining above 98.610, after a strong reversal on Monday and Tuesday, and this surge in dollar Index futures sustains above the immediate resistance at 99 could push the gold futures below the immediate support at the 50 DMA at $3366 before this weekly closing.
I anticipate that the recent progress in U.S. trade deals with the European Union eased some fears of an escalated trade war, but it bolstered the U.S. dollar. This, in turn, weighed on gold by making it more costly for the overseas buyers.
Technical Level to Watch
In a monthly chart, gold futures started an uptrend after finding a breakout above a significant resistance at $2054 in Feb. 2024, and after maintaining this uptrend, found one more breakout above the next significant resistance at $2817 in Jan. 2025 on the inauguration of the U.S. President Donald Trump.
Undoubtedly, this uptrend continued after breaking the next resistance at $3128 in Apr. 2025, but threw the gold futures inside an overbought territory. After facing stiff resistance at $3510 in April, it continued to remain volatile since May 2025, and despite repeated attempts, gold futures could not sustain above a pivotal point at $3283.
I anticipate that despite the formation of a bullish candle for this month by gold futures, still bearish pressure is visible at the current levels that could push the gold futures even below this pivotal point this month if U.S. President Steps back once again on tariff deadline stance as the gold futures could not find a breakout above the immediate resistance at $3461 since May 2025 as the gold has already lost its haven potential.
In a weekly chart, gold futures have formed an exhaustive hammer last week, which could get a confirmation candle if a breakdown is seen below the immediate support at the 20 DMA at $3298, as the gold futures are currently trading below the immediate resistance at the 9 DMA at $3382.
In a daily chart, gold futures are trying to hold above the immediate support at the 50 DMA at $3366 but are facing stiff resistance at the immediate resistance at $3389 due to the extensive bearish pressure since the formation of three black crows that resulted in the formation of an exhaustive candle on Monday.
Disclaimer: Readers are advised to take any position in gold at their own risk, as this analysis is based only on observations.