Gold Price Rebounds Toward $3,365 as US Dollar Weakens on Fed Autonomy Concerns

Gold Price Rebounds Toward $3,365 as US Dollar Weakens on Fed Autonomy Concerns

Gold (XAU/USD) is staging a rebound from its earlier weekly lows, climbing toward $3,365 during Thursday’s European trading session. The move comes amid a broader bullish correction, following a sharp mid-June selloff that had dragged the precious metal to the $3,290–$3,300 support zone.

USD Weakness Supports XAU/USD Recovery

The renewed weakness in the US Dollar (USD), triggered by growing market fears over Federal Reserve independence, is providing tailwinds to the yellow metal. After US President Donald Trump publicly criticized Fed Chair Jerome Powell, referring to him as an "average mentally person" and hinting at a possible early replacement, markets have responded with heightened concern over central bank autonomy.

📉 The result: a crash in US Treasury yields and the DXY Dollar Index, reviving demand for Gold despite reduced geopolitical risk.

Technical Setup: Is $3,365 the Next Target?

The daily chart shows XAU/USD bouncing strongly from near $3,300, validating that area as firm short-term support. Gold remains within a broad bearish channel, but this corrective rally suggests buyers are eyeing the upper boundary at $3,365.

Key Levels:

• Support: $3,300, $3,290
• Resistance: $3,365, $3,388 (channel top), $3,400 psychological barrier

Additionally, the RSI remains neutral, allowing for further upside before overbought conditions trigger fresh selling.

Market Narrative: A Fed Under Pressure

The broader "Sell America" narrative is gaining momentum as:

• Fed officials maintain a dovish tone.
• Rate cut bets for late 2025 increase.
• Trump’s political interference casts a shadow over monetary policy reliability.

While Middle East tensions have eased, diminishing safe-haven flows, political instability and rate expectations continue to favor Gold.

Related Reads on Tredu:

• Gold Forecast: XAU/USD Outlook This Week
• Dollar Index Trends: How Politics Move the DXY
• Powell vs Trump: What It Means for Global Markets