Gold’s rebound faces a critical test near the $3,350 mark, with traders caught between geopolitical risks and looming Federal Reserve signals.
Gold prices staged a recovery toward $3,350 on Monday after sinking to an 11-day low, but the safe-haven asset faces strong headwinds as global markets juggle optimism with unresolved geopolitical risks. Meanwhile, the US Dollar remains pinned near two-week troughs, amplifying volatility across the board.
Geopolitics: All Eyes on Washington
Markets are bracing for a high-stakes meeting between US President Donald Trump and Ukrainian President Volodymyr Zelenskiy, following a weekend summit in Alaska between Trump and Russian President Vladimir Putin that ended without a breakthrough on Ukraine.
According to Reuters, European leaders from Germany, the UK, and France will also join the Washington talks, raising hopes of a rapid peace deal. However, if negotiations falter—as they often have in the past—risk sentiment could quickly sour, reigniting demand for Gold as a safe haven.
Market Mood and Fed Outlook
Despite lingering geopolitical uncertainty, traders remain cautiously optimistic. Hopes that Trump could ease sanctions on Russia while boosting investment, alongside dovish Federal Reserve expectations, have fueled risk appetite and capped Gold’s upside momentum.
Still, the tide could shift swiftly. A US Dollar rebound, driven by profit-taking and short-covering ahead of key Fed events, may pressure Gold back lower.
Fed in Focus: Powell’s Words Could Be a Game-Changer
Attention is now turning to the July Fed meeting minutes and the Jackson Hole Symposium (Aug. 21–23). Fed Chair Jerome Powell’s speech on Friday will be closely scrutinized for hints on how far and fast the central bank might cut rates beyond September.
Traders know the stakes are high: any signal of deeper or delayed easing could redraw the Gold chart entirely, either reinforcing safe-haven flows or triggering a sharp corrective move.