Gold holds steady around $3,380 ahead of major trade and Fed updates- Prices eye $3,434 if bullish momentum returns: Gold (XAUUSD) is trading around $3,380 on Wednesday, 7 May 2025, as investors pause to assess the impact of several global events. The yellow metal had enjoyed a two-day rally before cooling off as traders turned cautious ahead of two key developments: US-China trade talks and the Federal Reserve's interest rate decision due later today.

The current environment is a mix of uncertainty and opportunity. While fears around global trade tensions initially boosted demand for safe-haven assets like gold, optimism around negotiations between Washington and Beijing is capping further gains—for now.

Why did gold pause its rally today?

Gold (XAUUSD) slowed down after two days of gains, hovering near $3,380 on Wednesday morning. The reason? Investors are waiting for clarity. Talks between the United States and China are expected soon, and any signs of progress may reduce the urgency to hold safe-haven assets like gold.

Earlier this year, tensions flared up when former U.S. President Donald Trump hiked tariffs on Chinese imports to 145%, while easing duties for most U.S. trading partners. China responded with its own tariffs, raising global uncertainty. Now, markets are watching closely to see if both sides will soften their stance.

Still, there's no guarantee these talks will happen—or that they’ll produce results. That uncertainty has kept gold prices supported, but not soaring.

What impact could the federal reserve have on XAUUDS prices?

Later today, the Federal Reserve wraps up its meeting, and investors are tuning in for signals from Fed Chair Jerome Powell. While markets largely believe the Fed will leave interest rates unchanged, Powell’s comments could influence gold’s next move.

If the Fed hints at keeping rates higher for longer, that could put pressure on gold. But if the tone sounds more cautious—possibly signaling rate cuts later this year—gold prices could jump.

Interest rates and gold tend to move in opposite directions. When rates go up, gold becomes less attractive since it doesn’t yield interest. When rates drop or stay low, gold usually benefits.

Is the current price of gold (XAUUSD) signaling another breakout?

Technically, gold (XAUUSD) still looks strong on the H4 chart. Prices are holding above key support at $3,358, and analysts suggest that if gold continues to bounce off this level, it could test $3,434 in the short term.

This level—$3,434—is the immediate upside target if buyers return with momentum. For now, the consolidation around $3,380 reflects market hesitation rather than weakness.

Will us-china trade talks change gold’s direction?

Absolutely. The outcome of U.S.-China trade negotiations could shift the entire outlook for gold. If talks collapse or lead to more tariffs, investors could rush back to gold, pushing prices higher. On the flip side, a positive outcome might ease global fears and reduce demand for safe-haven assets.

What’s the gold (XAUUSD) forecast for today, 7 may 2025?

Despite the current pause, the outlook for gold remains positive. As long as it stays above the $3,358 support zone, there's potential for a fresh climb. The key resistance is at $3,434, and a break above this could trigger more buying.

Markets are in a holding pattern today, but that could change quickly depending on how the Fed meeting and trade updates unfold.

FAQs:

Q1: What is the current Gold (XAUUSD) price forecast for 7 May 2025?
Gold (XAUUSD) is expected to target $3,434 if support at $3,358 holds.

Q2: How are US-China trade talks affecting Gold (XAUUSD)?
Talks could reduce safe-haven demand, keeping Gold (XAUUSD) prices steady or lower.