Gold Performance in a Volatile Market

Spot gold experienced fluctuations between $3,296 and $3,343 on July 7, settling at $3,330, marking a slight decrease. The MCX August gold contract saw a modest rise, influenced by the weakening Indian Rupee amidst tariff concerns. Despite positive US economic indicators, gold's appeal remains strong due to ongoing tariff uncertainties and a softer US Dollar.

Impact of Trump's Tariff Moves

The extension of the tariff deadline to August 1 and the announcement of reciprocal tariffs on several countries have introduced new dynamics into the gold market. With Japan and South Korea facing a 25% tariff rate, the market is bracing for further announcements, keeping investors on edge.

Upcoming Economic Indicators

Attention now turns to the FOMC minutes and China's PPI and CPI data, which could provide further direction for gold prices. Meanwhile, the US Dollar Index and yields have shown upward trends, adding another layer of complexity to gold's outlook.

Gold's Safe Haven Status

With China continuing its gold buying spree and global ETF holdings near a two-year high, the metal's safe haven status is reinforced. However, the potential for trade deal breakthroughs poses a risk to its upward trajectory.

Short-Term Trading Strategy

Experts recommend a cautious approach, with selling on rallies advised for the ultra-short term. Key levels to watch are $3,247 as support and $3,400 as resistance, with domestic prices likely swayed by Rupee fluctuations.