Gold Recovers to $3,255 as Traders Await US CPI Data by Amit Gupta, Kedia Advisory
Gold prices edged higher to around $3,255 in early European trading on Tuesday, recovering some lost ground. The temporary de-escalation in US-China trade tensions, with both nations agreeing to lower tariffs for 90 days, has lifted risk sentiment, reducing demand for safe-haven assets like gold. However, traders are staying cautious ahead of the US April Consumer Price Index (CPI) data, which could influence the Federal Reserve’s monetary policy outlook. While gold maintains a positive longer-term technical outlook above the 100-day EMA, near-term consolidation remains possible. Rising geopolitical concerns involving India-Pakistan and Ukraine-Russia may offer further support to gold prices amid any escalation.
Key Highlights
* Gold price rebounds to $3,255 ahead of key US CPI release.
* US-China agree to cut tariffs temporarily, improving risk sentiment.
* CPI data may hint at Fed’s rate cut timing and path.
* Technical outlook stays positive with support above 100-day EMA.
* Geopolitical tensions in Asia and Europe may aid gold demand.
Gold traded higher around $3,255, recovering from previous losses as yellow metal found some footing as investors turned cautious ahead of the US April Consumer Price Index (CPI) release, a key indicator that could shape expectations for the Federal Reserve’s next policy move.
Despite this modest rebound, gold’s upside remains capped due to improved market sentiment following a temporary trade agreement between the United States and China. Both countries agreed to reduce tariffs for 90 days, which has softened fears of prolonged economic strain. The US will cut its import tariffs on Chinese goods to 30% from 145%, while China will lower its duties to 10% from 125%. This move reduces safe-haven demand, often a key driver of gold prices.
From a technical perspective, gold maintains a constructive long-term outlook, with prices holding above the 100-day Exponential Moving Average. However, a mild consolidation phase is likely as the 14-day RSI remains below the midline. Immediate resistance is seen at $3,350, with further gains potentially leading to $3,430 and the all-time high of $3,500. On the downside, key support lies at $3,200 and $3,140.
Beyond trade and inflation data, global geopolitics are also in focus. Tensions between India and Pakistan, and a possible meeting between Ukraine’s and Russia’s presidents, could create volatility. Any flare-up could renew demand for gold as a safe haven.
Finally,
While gold remains technically strong, its near-term path hinges on US inflation data and global political developments that could renew investor demand for safety.
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