Gold (XAUUSD) halts rally: correction needed

Gold (XAUUSD) prices have stalled near 3,358 USD, with the fundamental backdrop for gold (XAUUSD) remaining favourable. Find more details in our analysis for 4 August 2025.

XAUUSD forecast: key trading points

• Although gold (XAUUSD) prices pulled back after a sharp rally, the outlook remains positive
• The market is assessing weak US data and expects an imminent Fed rate cut
• XAUUSD forecast for 4 August 2025: 3,373

Fundamental analysis

On Monday, gold (XAUUSD) prices declined to 3,358 USD per ounce, undergoing a correction after Friday's sharpest two-month rally. Investors are weighing the implications of new tariffs proposed by President Donald Trump and the likelihood of a Federal Reserve rate cut.

At the end of last week, prices rose by 2.2%, the strongest daily gain since 2 June. Demand for safe-haven assets surged following news of sweeping trade tariffs ranging from 10% to 41% on imports from dozens of countries. The new measures are set to take effect on 7 August.

Additional support for gold came from weak US labour market data, which reinforced expectations that the Federal Reserve could cut rates as early as September.

The gold (XAUUSD) forecast is positive.

XAUUSD technical analysis

On the H4 chart, gold (XAUUSD) prices are trading around 3,358 per ounce, having played out a strong upward move that began on 31 July. At that time, the quotes sharply bounced from the 3,267 support level and broke above key resistance levels at 3,281 and 3,344 within a few candles.

Currently, prices are trading in the upper range of the Bollinger Bands indicator, suggesting short-term overbought conditions. However, the upper band is widening, indicating increased volatility.

The nearest resistance level stands at 3,373. If prices consolidate above current levels, they may test this mark. A breakout would pave the way towards the July high of 3,439. Otherwise, prices might correct towards the 3,344 support level and then to the 3,325-3,300 area.

The overall trend since the end of July remains upward, but further movement will depend on how the market reacts to external factors, namely, US trade policy and Federal Reserve rate expectations.

Summary

Gold (XAUUSD) entered a correction phase after Friday’s rally. The gold (XAUUSD) forecast for today, 4 August 2025, suggests an upward wave towards 3,373.