Gold price forecast: Traders await U.S. CPI for 6-day consolidation breakout signal
Gold price have remained locked in a tight consolidation range, but key technical indicators and upcoming economic data suggest a potential breakout.
The precious metal gained over 1% yesterday but remained within a six-day trading range between $2,930 and $2,877. As of today’s Asian and European sessions, volatility has been minimal, with prices hovering around $2,920.
Market participants are closely watching the U.S. Consumer Price Index (CPI) report, as it will provide fresh insights into the Federal Reserve’s rate-cut trajectory. Any indication of cooling inflation could weigh on the U.S. dollar and boost gold’s appeal as a non-yielding asset.
Meanwhile, sentiment has improved following the de-escalation of tariff threats between the U.S. and Canada, easing concerns over trade disruptions. However, fresh uncertainties arise as U.S. President Donald Trump’s tariffs on aluminum and steel imports take effect today. This policy shift, coupled with broader fears of a global trade slowdown, is adding to gold’s safe-haven demand.
Gold price dynamics (Feb 2025 - March 2025). Source: TradingView.
XAU/USD technical outlook: Bullish RSI and 50-day EMA support potential breakout
Technically, both short-term and long-term RSI indicators are both in bullish territory, pointing to further upside potential. Additionally, the 50-day EMA on the 4-hour chart is providing near-term support at $2,907. Given this confluence of fundamental and technical factors, gold appears poised to challenge the $2,930 resistance level. A successful breakout could see prices target the recent peak of $2,956.
Gold’s outlook hinges on whether prices can break out of their current range. If bullish momentum persists, a move beyond $2,930 could set the stage for further gains. Conversely, failure to hold above support at $2,907 may see prices retest the lower boundary of $2,877. The next catalyst for a decisive move will likely come from the U.S. inflation data and its impact on Fed policy expectations.
Market sentiment weakened over the U.S. economy, due to President Trump calling it a “period of transition.” Gold found support at $2,877 after a 1% drop, rebounding toward $2,900.
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