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Gold Analysis: Dollar's Recovery Increases Gold's Losses

By Mahmoud Abdallah

Mahmoud has been working fulltime in the Foreign Exchange markets for 12 years. Offers his analysis, articles and recommendations at the most renewed Arabic websites specialized in the global financial markets, and his experience gained a lot of interest among Arab traders. Works on providing technical analysis, market news, free signals and more with follow up for at least 12 hours a day, and aims to simplify forex trading and the concept of tra...

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Today’s Gold Analysis Overview:

  • The overall Gold Trend: Neutral with a downward bias.
  • Gold Support Levels Today: $3310 – $3270 – $3220 per ounce.
  • Gold Resistance Levels Today: $3360 – $3350 – $3410 per ounce.

Gold Analysis 21/08: USD Recovery Increases Losses (Chart)

Today's Gold Trading Signals:

  • Buy gold from the $3290 support level, with a target of $3400 and a stop-loss at $3270.
  • Sell gold from the $3370 resistance level, with a target of $3280 and a stop-loss at $3400.

Technical Analysis of Gold Price (XAU/USD) Today:

The recovery of the US dollar continues to increase losses for gold, which has fallen to the $3335 support level after yesterday's failed attempts to recover toward the $3352 resistance. As previously mentioned, the performance will remain cautious and under selling pressure until markets and investors react to what will be said by global central bank officials during the Jackson Hole Symposium, which begins today and ends tomorrow.

Indications regarding future interest rates, particularly US interest rates, will strongly influence the course of gold prices in the coming days.

Will gold prices decline in the coming days?

According to forecasts and expectations from gold analysts, gold prices declined as investors positioned themselves ahead of the US Federal Reserve's three-day Jackson Hole symposium, which begins later today. The market is closely focused on remarks by Federal Reserve Chairman Jerome Powell for clues about the central bank's monetary policy stance. Traders are currently pricing in an 82% chance of a US interest rate cut in September. Meanwhile, the latest minutes of the Fed's meeting showed that policymakers remain concerned about both inflation and the labor market, with most voting members agreeing that it is too early to cut interest rates.

On the geopolitical front, which also affects gold trading, Russia stated yesterday that attempts to address security concerns regarding Ukraine without Moscow's involvement are a "dead end." This was a warning to the West, which has begun to explore security guarantees for Kyiv after the conflict ends.

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Today's Gold Trading Scenario

Based on the daily chart, the gold price index remains more bearish. As we mentioned before, breaking the $3,300 support level will remain the most important for further bear control. Currently, the 14-day Relative Strength Index (RSI) is around 48 below the midline, supporting bears in a downward movement and preparing for heavier losses. Meanwhile, the MACD line is trending downward to close at 12.26, awaiting further selling pressure to confirm the downward shift.

On the upside, and over the same timeframe, the $3,375 and $3,400 resistance levels will remain the most important for confirming the strength of the uptrend once again. The gold market will continue to be influenced by investor risk appetite, central bank gold bullion purchases, and the performance of the US currency.

The Dollar Index Stabilizes Ahead of Jackson Hole

According to today's currency market trading, the US Dollar Index (DXY), which measures the dollar's performance against a basket of other major currencies, has stabilized near 98.3 after its recent gains. Investors are awaiting the annual Jackson Hole Symposium to get a sense of the Fed's direction on interest rates.

In general, financial markets are focused on Federal Reserve Chairman Jerome Powell's speech for clues on whether policymakers will push back against near-term expectations of quantitative easing. Futures currently indicate an 82% chance of a quarter-point rate cut in September, down from 94% the previous week. Minutes from the Fed's July meeting showed that officials remained more concerned about inflation than labor market risks, with the committee's divisions widening over tariffs.

In Washington, President Donald Trump has called for the resignation of Fed Governor Lisa Cook over allegations of mortgage fraud and has reiterated his push for lower US interest rates. With Powell's term expiring in May, Trump is also considering potential successors, while Treasury Secretary Scott Bessent has publicly advocated for a larger, half-point cut by September.

Trading Advice:

Traders advises traders to wait and hold off on gold trading until the markets react to significant events today and tomorrow. Meanwhile adopting a strategy of buying gold on every price dip and not taking risks.

Ready to trade our Gold forecast? We’ve shortlisted the most trusted Gold brokers in the industry for you.

Mahmoud has been working fulltime in the Foreign Exchange markets for 12 years. Offers his analysis, articles and recommendations at the most renewed Arabic websites specialized in the global financial markets, and his experience gained a lot of interest among Arab traders. Works on providing technical analysis, market news, free signals and more with follow up for at least 12 hours a day, and aims to simplify forex trading and the concept of trading for his audience.

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