China’s partial tariff exemptions encompassed agricultural products and semiconductors, undercutting some of the trade-war angst that fueled gold’s ascent. U.S. Treasury Secretary Scott Bessent’s assessment that several major trading partners have tabled “very good” proposals intensified the relief rally in risk assets, redirecting capital flows away from precious metals. Nonetheless, Beijing later distanced itself from formal negotiation claims, and that ambiguity continues to sustain a modest risk premium in bullion’s valuation.
Technical Levels Chart Bullish Safety Valve
A decisive breach below $3,300 would expose support between $3,265 and $3,260, a region that held during last month’s consolidation. Failure to defend this zone could swing momentum toward the 50% retracement at $3,225, opening the door to psychological support around $3,200. Conversely, reclaiming $3,348–$3,353 would signal bullish intent and potentially clear the path back to $3,400. Above that, resistance clusters at $3,425–$3,427 would come into focus before bulls mount another assault on $3,500.
Market memory points to the $3,200 area as a former ceiling turned floor, and IG strategists have flagged it as a strategic entry point on any dip. Technical indicators are stretched, suggesting a consolidation or pullback may be overdue. Traders anticipating a retracement can look for a bounce off $3,260 as confirmation of sustained buying interest.
Macro Drivers: Fed Rate Cuts, JOLTS and Geopolitical Flashpoints
The Federal Reserve’s blackout period ahead of its May 7 meeting coincides with growing wagers that June will mark the start of a renewed easing cycle. Forward markets currently price in roughly three 25-basis-point cuts by year-end, equivalent to 75 basis points, though some data sources hint at as much as 91 basis points of easing baked in. Such an outlook keeps a lid on the US dollar’s upside and bolsters gold’s floor, given the metal’s non-yielding nature.
All eyes now shift to the March JOLTS report, where open vacancies are forecast to dip from 7.568 million to 7.50 million. A softer reading could reinforce expectations for looser monetary policy, providing fresh support for bullion. Later this week, preliminary Q1 GDP and April employment figures—projecting a 135,000 rise in nonfarm payrolls and an unchanged 4.2% jobless rate—will further shape Fed rate path projections.
Geopolitical tension remains a wildcard. Russian President Vladimir Putin’s announced 72-hour unilateral ceasefire in Ukraine from May 8 was promptly rejected by Kyiv, and North Korea’s stated involvement in the conflict adds another layer of complexity. Such flashpoints historically underpin gold’s safe-haven premium, and any escalation could catalyze fast-flowing demand.
Treasury Yields and Real Rates Lean Bearish for the Dollar
U.S. 10-year Treasury yields hovered near 4.22%, while TIPS yields fell to 1.95%, underscoring real rates’ descent. Lower real yields diminish the opportunity cost of holding gold, amplifying its relative attractiveness. Should yields continue their downtrend, the metal could find additional support even if the dollar stages further recoveries.
Emerging Market Reflections: Indian Rupee Undercuts Local Gold Prices
In India, the world’s largest consumer of jewelry-grade gold, prices declined to ₹9,078.38 per gram from ₹9,162.60, while the tola rate eased to ₹105,888.50. Converted to the global spot benchmark, this equates to approximately ₹282,374 per troy ounce. Local dynamics—chiefly the rupee’s modest recovery against the dollar—have translated into a roughly 0.9% drop in domestic bullion rates. Traders within India are awaiting RBI commentary on potential reserves diversification, with expectations that central banks in emerging economies could continue to add to their gold hoards to hedge against currency volatility.
Onshore and Futures Market Dynamics
COMEX gold futures (symbol GC) edged down to $3,324.20 even as spot prices underperformed. The minor futures premium over spot suggests diminished immediate delivery demand. Options markets have priced in elevated volatility, with two-month implied swinging near 15%, compared to a five-year average of 12%. That skew points to persistent uncertainty around key events such as the U.S. jobs data and FOMC meeting outcomes.
Corporate Insider Transactions and Producer Activity
Major gold producers have reported scant insider buying or selling this past week. No substantial executive transactions have been disclosed by the likes of Newmont or Barrick, indicating management remains neutral on near-term share valuation. Mine supply metrics show a steady ramp-up in output, with global production estimated at 3,600 tonnes in Q1—up 2% year-on-year—tempering physical tightness that arguably supported record prices last month.
Strategic Outlook and Positioning Recommendation
With technicals indicating a corrective phase, macro drivers still skew supportive and geopolitical risks far from abating, bullion appears poised to consolidate within the $3,200–$3,400 range. Risk-off surges could drive quick rallies back toward $3,400, yet near-term profit-taking may test $3,260. Under these circumstances, deploying incremental long positions on dips to $3,200 is a prudent approach. Given the confluence of Fed easing expectations and persistent global tensions, targeting a $3,350 exit-zone offers a balanced risk-reward profile.
Recommendation: BUY on dips around $3,200 with a medium-term target near $3,350.
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