Gold Price Forecast: XAU/USD slumps to near $3,300, 50-day EMA acts as key support

• Gold price falls sharply to near $3,300 as the US Dollar performs strongly across the board.
• The US Dollar trades firmly ahead of US tariff deadline on July 9.
• Traders pare Fed dovish bets on better-than-projected US NFP data for June.

Gold price (XAG/USD) is down almost 0.8% to near $3,300 during the European trading session on Monday. The yellow metal faces a sharp selling pressure as risk-off market sentiment has increased safe-haven demand of the US Dollar (USD).

Technically, higher US Dollar makes the Gold price an expensive bet for investors. The US Dollar Index (DXY), which tracks the Greenback's value against six major currencies, revisits the weekly high around 97.45.

Market sentiment turns risk-averse as investors await United States (US) trade-related-headlines in the countdown to the reciprocal tariff deadline on July 9. So far, Washington has signed trade agreements with the United Kingdom (UK) and Vietnam, and a limited pact with China and has expressed confidence that it will strike deals with more trading partners soon.

Meanwhile, US President Donald Trump has announced that he will send letters to those nations, specifying tariff rates, with whom a deal has not been signed or discussed during the 30-day tariff pause.

Theoretically, the safe-haven demand of Gold should have increased too amid global economic tensions. However, the Gold price trades lower as a sharp decline in traders' bets supporting interest rate cuts by the Federal Reserve (Fed) in the policy meeting later this month have dampened its appeal. Traders pare Fed dovish bets due to upbeat US Nonfarm Payrolls (NFP) data for June.

Higher interest rates by the Fed bodes poorly for non-yielding assets, such as Gold.

Gold technical analysis

Gold price trades close to the upward-sloping trendline of an Ascending Triangle formation on a daily timeframe, which is placed from the April 7 low of $2,957. The horizontal resistance of the above-mentioned chart pattern is plotted from the April 22 high around $3,500. Theoretically, a breakdown of the asset below the upward-sloping trendline results in a sharp downfall.

The precious metal trades below the 20-day Exponential Moving Average (EMA) around $3,334, suggesting that the near-term trend is uncertain.

The 14-day Relative Strength Index (RSI) oscillates inside the 40.00-60.00 range, indicating a sideways trend.

Looking up, the Gold price would enter in an unchartered territory after breaking above the psychological level of $3,500 decisively. Potential resistances would be $3,550 and $3,600.

Alternatively, a downside move by the Gold price below the May 29 low of $3,245 would drag it towards the round-level support of $3,200, followed by the May 15 low at $3,121.

Gold daily chart