Gold Retreats from Highs as Bearish Signals Stack Across Timeframes

After reviewing the movements of the gold futures in different time patterns, I anticipate that after testing a low $3314 on July 17, gold futures tested a recent high at $3451 on July 22 within five trading session and met an advent of selling spree that pushed the futures back to the pavilion – below the 200 DMA within two trading session amid growing optimism of tariff trade deals.

Despite losing its haven potential at higher price, gold could still feel some haven demand as the markets hunkered down before a series of key events in the coming week as the focus initially will be on the Federal Reserve, which is widely expected to keep the interest rates unchanged despite repeated calls from the US President Donald Trump to cut rates.

At the same time, Fed Chair Jerome Powell has signaled that uncertainty over the inflationary effects of Trump’s tariffs is likely to keep the Fed from cutting interest rates anytime soon.

On the other hand, Trump’s August 1 deadline for his steep trade tariffs will also pass next week, with focus squarely on whether more trade deals will be met by August 1 or not.

Technical Levels to Watch

Undoubtedly, the current scenario indicates the quantum of selling pressure on the gold futures is quite visible as they are trading on Friday below a significant support at the 200 DMA at $3374 in the 1-Hr. Chart, after the formation of two bearish crossovers as the 50 DMA has come down below the 100 DMA along with 9 DMA and 20 DMA, and has formed one more bearish crossover below the 200 DMA, which ensures a steep slide could be there shortly.

In a daily chart, gold futures have formed three Outside Bearish – has generated the potential of a steep slide that could start on Friday, which makes this weekly closing level to remain in focus for the next week’s opening level.

In a weekly chart, gold futures have already formed a bearish hammer that is likely to be followed by a confirmatory bearish candle next week.

I anticipate that if the weekly candle of this week sees completion before the week’s closing on Friday, a closing below $3313 will keep the price exhaustion intact during the upcoming weeks, as the tariff trade deals potentially to remain on a progressive path next week.

Disclaimer: Readers are expected to take any position on gold, as this analysis is only based on observations.