Gold Price Dips Below $3,400 Ahead of US PMIs Amid Fed Hawkishness, Geopolitical Risks

Gold Price Holds Bearish Tone as Traders Eye US PMIs, Iran Tensions

The price of gold (XAU/USD) extended its downside momentum on Monday, trading below $3,400 during the early European session. The Federal Reserve’s hawkish tone and a stronger US Dollar are dampening investor appetite for the non-yielding metal.

Fed’s Hawkish Stance Supports USD, Pressures Gold

Gold's decline continues as the Federal Reserve maintains its aggressive monetary policy stance, suggesting interest rates could stay higher for longer. This environment benefits the US Dollar, pushing gold lower as it becomes costlier for non-USD buyers.

Higher interest rates reduce the appeal of gold, which does not offer yield.

Geopolitical Risk Fails to Propel Gold Higher

Despite heightened geopolitical tensions — notably, the US airstrikes on Iranian nuclear facilities — gold has failed to mount a strong safe-haven rally. While the potential for escalation exists, investors remain cautious and are awaiting Iran’s response.

Iran has issued warnings but has yet to deliver a direct retaliation affecting US interests.

Flash PMIs in Focus

Investors are now turning attention to the flash US PMI data, which could provide the next catalyst for gold price movement. Stronger-than-expected data may strengthen the USD further, while a miss could rekindle gold demand.

Technical Outlook: Watch $3,400 and $3,355

• Resistance: $3,400 (psychological level), followed by $3,440
• Support: $3,355 (last week’s low), then $3,320

A potential bearish Head and Shoulders pattern is developing, with a neckline around $3,355–$3,360, suggesting more downside risk if confirmed.

Internal Linking Suggestions (for Tredu.com):

• Gold Technical Analysis: Is a Deeper Pullback Coming?
• What Moves the Gold Price? Key Factors Explained
• US Dollar Forecast This Week: Fed, PMI, and Risk Sentiment
• Geopolitical Risk and Market Volatility: How to Trade It