18.07.202519:15 Forex Analysis & Reviews: XAU/USD. Analysis and Forecast. Gold is supported by moderate USD weakness and trade-related uncertainty

Today, gold is trading higher, remaining within a sideways trend. Late Thursday, Federal Reserve official Christopher Waller stated that rising risks to the economy could justify a key rate cut, emphasizing that the central bank should consider lowering its target interest rate as early as July, given signs of labor market weakening. These comments put some pressure on the US dollar, causing it to decline.

At the same time, market participants have already priced in a potential 50 basis point rate cut for the current year. Moreover, growing concerns over the unpredictable trade policy of President Donald Trump continue to fuel demand for gold as a safe-haven asset. Recently, Trump announced a 50% tariff on copper imports to the US. He also informed the leaders of 25 countries about new tariffs set to take effect on August 1, and plans to send letters to over 150 nations warning of potential tariff hikes to 10% or even 15%. These measures are creating an atmosphere of uncertainty, prompting investors to act cautiously when assessing the value of precious metals.

On the macroeconomic front, the US Department of Commerce reported yesterday that retail sales rose by 0.6% in June, surpassing analysts' expectations and indicating a modest recovery in consumer demand. This improvement follows a 0.9% decline in May and a 0.1% drop in April, offering some hope for economic stabilization despite headwinds.

Additionally, the number of initial jobless claims dropped for the fifth consecutive month, falling to 221,000 for the week ending July 12. This is the lowest figure in three months and reflects the continued resilience of the US labor market. Despite concerns about inflationary pressures stemming from new tariffs, this data supports the possibility that the Fed may delay rate cuts, thereby lending support to the dollar.

Fed Governor Adriana Kugler emphasized the importance of maintaining a restrictive policy stance to support long-term inflation expectations, suggesting it may be appropriate to keep the key rate unchanged for a while. Meanwhile, Atlanta Fed President Raphael Bostic pointed to the high degree of uncertainty in the economic outlook, stating that a rate cut in the near future may be difficult to justify.

The Fed is expected to keep its benchmark rate in the 4.25%–4.50% range at its upcoming monetary policy meeting later this month. This scenario could act as a headwind for gold prices, which are currently under pressure due to rising expectations for higher dollar yields.

From a technical standpoint, although oscillators are in positive territory, they are close to neutral levels, and prices remain within a narrow sideways range. Therefore, it would be prudent to wait for a breakout from this trading range before opening new positions.

Key support for gold is found at the 50-day SMA, located around 3324 dollars, followed by the round number of 3300 dollars. Resistance lies at the upper boundary of the range at 3365 dollars. A breakout above this area could allow the yellow metal to reach the 3400-dollar mark.