The gold price dip continued on Friday, sliding below $3,300 as uncertainty surrounding US-China trade relations unsettled markets. Despite US President Donald Trump’s claims of active trade talks with Chinese President Xi Jinping, Beijing firmly denied that any discussions are currently underway.
Market Volatility Driven by Mixed Signals
Gold (XAU/USD) extended its losses as traders cashed in on recent gains, reacting to a flood of conflicting headlines. President Trump stated that “200 trade deals have been made” and suggested he had been in contact with Xi. However, Chinese officials dismissed these assertions, creating confusion and shaking investor confidence.
Earlier in the day, Bloomberg reported that China was considering exempting some US goods from tariffs due to rising costs, while also preparing emergency plans for external shocks. These developments briefly boosted optimism in equity markets, prompting a shift away from safe-haven assets like gold.
Investor Sentiment and Global Reactions
Traders seem to be buying into the prospect of a breakthrough in US-China relations. This optimism sent global stocks higher and reduced demand for gold. Meanwhile, the Swiss National Bank reported a CHF 6.7 billion profit from gold holdings in Q1, and Kenya’s central bank revealed plans to diversify its reserves by potentially adding gold.
In China, the gold rally triggered a surge in retail demand and record-breaking trading volumes on the Shanghai exchange. Authorities have since issued warnings over excessive speculation in the market.
Read: Gold Price in Pakistan Hits New High Amid Global Uncertainty
Technical Outlook: Gold Finds Support
Technically, gold’s recent rally appears overheated and due for correction. The precious metal tested the intraday support at $3,302 after briefly dipping below it. A more significant support level lies at $3,256, with a key floor near $3,245—the April 11 high.
To regain bullish momentum, gold must first reclaim the daily Pivot Point at $3,335. If it breaks above that, resistance looms at $3,381 (R1 level) and then at $3,414 (R2), just above the psychological $3,400 mark.
What’s Next for Gold?
As markets digest ongoing trade rumors and mixed geopolitical messages, gold prices may remain volatile. Traders are watching closely for any real progress or further contradictions in the US-China narrative. If talks fail to materialize, gold could bounce back sharply, revisiting the $3,500 level in the coming weeks.
Follow us on Google News, Instagram, YouTube, Facebook,Whats App, and TikTok for latest updates
