Gold Price Forecast This Week: Beware of a Plunge Below US$4,000!

Jakarta, CNBC Indonesia - Heading into early August, global gold prices are once again under pressure and approaching the psychological level of US$4,000 per troy ounce. The strengthening of the United States (US) dollar and rising expectations of high interest rates from the Fed are the main factors weighing on the precious metal’s movement. Referring to Refinitiv, the price of gold in trading on Monday (3/8/2026) at 07.01 WIB was at US$4,075.17 per troy ounce, surging 0.85%. This strengthening comes as welcome news after the gold price slumped 1.5% in the last trading session of the previous week, Friday (31/7/2026). Gold prices strengthened 0.69% last week. In July 2026, gold prices strengthened 0.84%, ending a four-month consecutive weakening streak. Technically, the short-term trend for gold prices remains bearish after failing to hold above the US$4,100 level. Pressure on gold emerged alongside a resurgence in the US dollar and US Treasury yields. Market sentiment was also influenced by escalating US-Iran conflict after Washington launched retaliatory strikes against Iran following an attack on US forces in Jordan. Typically, heightened geopolitical tensions support safe-haven assets. However, this time investors are flocking more to the US dollar than gold, causing the precious metal to lose its upward momentum. From a monetary policy perspective, the market is still assessing that the possibility of a Fed rate hike is not entirely off the table. Although Fed Chair Kevin Warsh has not given a firm signal regarding further tightening, the resilience of the US economy keeps the market cautious. HSBC analysts assess that the US dollar still has room to strengthen thanks to the relatively solid economic fundamentals of the United States and an attractive interest rate differential compared to other countries. Technically, the US$4,000 area is a very important psychological support. If this level is breached, selling pressure could potentially intensify. Meanwhile, the nearest resistance is around the US$4,185 range. Going forward, the direction of gold’s movement will be heavily determined by developments in the Middle East conflict and market expectations regarding the Fed’s policy. Should the central bank begin to open up the possibility of monetary easing or the dollar weakens again, gold prices have the potential to gain strength for a rebound. The weakening of the US dollar index (DXY) from its previous highs should be a positive sentiment for gold. However, other factors such as high real yields, Fed rate expectations, and investor positioning in the futures market are still holding back gold’s rally. Latest data from the Commodity Futures Trading Commission (CFTC) shows that speculators’ net long positions in gold have decreased. This means many hedge funds and investment managers are choosing to reduce exposure while waiting for clearer market signals. Analysts at Dupoin Futures explained that gold’s failure to hold above the US$4,120 area is a signal that buying power is starting to weaken. The emergence of a swing high pattern on the short-term chart also indicates the dominance of market participants engaging in selling actions. Nevertheless, the medium-term outlook for gold is still considered positive. Demand for safe-haven assets remains strong amid geopolitical uncertainty, ranging from the Middle East conflict to the Russia-Ukraine war. Overall, Dupoin Futures projects that gold is still vulnerable to a correction towards US$4,026 as long as it is unable to break back through the US$4,120 resistance, although the medium-term trend is still supported by safe-haven sentiment and prospects for future monetary easing.