Gold prices ticked higher on Tuesday, benefitting from a softer dollar and revived hopes for U.S.-China trade stability and Russia-Ukraine negotiations. Despite the broader risk-on tone capping further gold upside, lingering uncertainty and recent credit jitters have kept downside limited.
ActivTrades’ Ricardo Evangelista said traders are still eyeing safe-haven hedges, while Swissquote’s Carlo Alberto De Casa projected a price “superzone” above $3,200 if support levels hold. This duality—strong risk appetite coexisting with hedging demand—mirrors the tug-of-war in currency markets.
Market Forecast: Dollar Faces Downward Pressure as Risk Appetite Builds
With the DXY still elevated around 10% above its 20-year average and speculative net short positions near multi-year highs, the dollar remains vulnerable to deeper corrections.
The combination of reduced U.S. asset appeal, debt-driven skepticism, and a reevaluation of reserve currency status signals further downside risk. While technical support may trigger near-term rallies, the broader setup favors selling strength.
Unless U.S. economic surprises force a hawkish Fed pivot, dollar rallies are likely to be capped, especially as gold continues to attract safe-haven flows and foreign investors reevaluate dollar-heavy exposures.
More Information in our Economic Calendar.
