Gold prices edged higher in early Asian trading on Wednesday, stabilizing above the $3,350 mark as investors awaited crucial U.S. economic data and Federal Reserve policy signals for a clearer market direction. The mild rebound comes after prices retreated from a monthly peak of $3,392 on Tuesday, amid renewed pressure on the U.S. Dollar and escalating global trade tensions.
The yellow metal benefited from a fresh wave of selling in the dollar, spurred by mounting concerns over the Trump administration’s aggressive trade policies. A critical deadline set by the White House for trade partners to submit revised proposals looms Wednesday, while a key tariff hike—doubling import duties on steel and aluminum from 25% to 50%—takes effect at 4:00 GMT.
Geopolitical tension further intensified after FBI Director Kash Patel announced on social media platform X the arrest of two Chinese nationals accused of smuggling a dangerous fungus with bioterrorism potential into the U.S. This development heightens investor caution ahead of an anticipated phone call between President Donald Trump and Chinese President Xi Jinping scheduled for Friday.
Last week, both nations accused one another of breaching a recent trade agreement, fueling concerns of a potential resurgence in tariff escalation. These fears, coupled with broader risk aversion, have continued to support gold’s safe-haven appeal despite near-term volatility.
Focus Shifts to U.S. Economic Reports and Fed Guidance
Market participants now turn their attention to two key U.S. data releases due later in the day: the ADP Employment Change and the ISM Services PMI. These indicators are expected to provide fresh insights into the health of the American economy and help shape expectations for the Fed’s next policy move.
On Tuesday, the U.S. Dollar found brief support from stronger-than-expected JOLTS Job Openings data, which reported 7.39 million vacancies for April—exceeding the forecast of 7.1 million and up from 7.2 million in March. While the data highlighted ongoing labor market strength, the broader market remains focused on forward-looking indicators that could influence the Fed’s interest rate path.
Technical Outlook: Gold Price Eyes Resistance Levels
From a technical perspective, gold maintains a bullish bias in the short term, supported by a confluence of key indicators. The 21-day Simple Moving Average (SMA) and the 38.2% Fibonacci retracement of the April rally converge near $3,297, serving as a strong support zone for buyers.
The 14-day Relative Strength Index (RSI) continues to trend higher and remains comfortably above the neutral 50 level, reinforcing the potential for further upside.
For the current upward momentum to extend, gold buyers must overcome resistance at the 23.6% Fibonacci level around $3,377 on a daily close. A break above that could open the door to retesting the May high of $3,439, with an eventual push toward the all-time high of $3,500 remaining a key target for bulls.
On the downside, any pullback below the $3,325 level—now a support following a breakout above a falling trendline—could signal a shift in sentiment. Below this, the $3,297 confluence area stands as critical support. A decisive break beneath it may expose gold to deeper losses, with the final line of defense seen around $3,240, where the 50-day SMA and the 50% Fibonacci retracement intersect.
Outlook: Waiting Game Continues
Until fresh data or geopolitical developments offer a clearer direction, gold is likely to remain range-bound above key technical levels. The combination of trade-related risks, dovish Fed speculation, and a weakening U.S. Dollar provides continued, albeit cautious, support for the precious metal.
