Gold price trades with modest losses; holds above $2,900 amid rising trade tensions – FXStreet

• As gold prices drop due to rising US bonds, USD can move away from months' lows.
• Trump's tariff plans and uncertainty about the fear of the trade war should serve as a tailwind for the Xau/USD pair.
• If the Fed cuts interest rates further this year, it could contribute to limiting the losses of yellow metals.

The gold price (XAU/USD) is added to the loss of the Asian session, further weakening the $2,900 mark and retesting it on Tuesday at a week's low tactile sensation. The US Dollar (USD) has gained aggressive traction for the second day in a row amid a modest pickup in US Treasury bond yields, further apart from its lowest level since December 10th.

But President Donald Trump's tariff plans and uncertainty over the fears of the trade war may continue to function as a tailwind for gold prices. Separately, expectations that the Federal Reserve will further cut interest rates amid signs cooling the US economy could limit the losses of non-two bullion. Traders may also choose to wait for the release of the US Personal Consumption Expense (PCE) price index on Friday.

Gold prices continue to lose ground behind some follow-through US purchases as they rebound US bond yields

• The US dollar is based on an overnight bounce from 11 weeks low amid a modest bounce on U.S. Treasury bonds, putting some downward pressure on gold prices during Thursday's Asian session.
• US President Donald Trump promoted hopes for another moratorium on sudden new tariffs on imports from Mexico and Canada, saying on Wednesday it could take effect on April 2 against a deadline prior to March 4.
• However, White House officials said the tariff deadlines on Mexican and Canadian goods were in effect at the moment “at this moment” and pending Trump's review to stop the flow of immigration to the US.
• Additionally, Trump said his administration would soon announce a 25% tariff on imports from the European Union.
• More interest rate cuts by the Federal Reserve this year has risen in the wake of recent downbeat US macro data, which has fueled concerns about the signs of a cooling economy and growth outlook.
• President Rafael Bostic, the federal president of Atlanta, noted on Wednesday that the US central bank should hold interest rates where they are at a level that continues to put downward pressure on inflation.
• Therefore, the focus will remain on the release of the US Personal Consumption Expense (PCE) Price Index (Fed's priority inflation measurement) scheduled for Friday for further clues on the central bank's rate cut path.
• In the meantime, Thursday's US Economic Docket features a reserve quarter GDP print release, durable product orders, pending sales of home sales, and claims of the first unemployed weekly unemployment, but could provide short-term driving force.
• Apart from this, speeches by influential FOMC members could provide more insight into the easing of policy this year.

Gold prices should be below $2,860 support, check the short-term top and support deeper loss prospects

From a technical standpoint, an area of ​​$2,888, or a lower tactile sensation on Tuesday could serve as more immediate support than a $2,878 zone and a $2,860-$2,855 region. Failure to adhere to the above support levels could make gold prices vulnerable and accelerate corrective decline towards the $2,834 region towards the $2,800 round figure mark.

Conversely, a positive move beyond the $2,920 immediate hurdle could attract some sellers near the $2,930 area overnight swing. A sustained strength beyond the latter could further raise gold prices towards a further horizontal resistance of between $2,950 and $2,955.