Gold prices continued their consolidation and decline.

Latest Confirmation Date:

August 2, 2026 (Sunday)

Spot gold prices fluctuated between $3995.81 and $4120.46 per ounce this week, with bulls and bears fiercely battling around the $4000 mark.

Overall, gold prices remained relatively stable this week.

However, this week's battle between bulls and bears contained a wealth of information—

Positive Factors:

Slower Personal Consumption Expenditures (PCE) Growth + Lower-than-Expected GDP Growth: Second-quarter GDP annualized growth was only 1.5% (expected 2.1%), and core PCE grew by 3.3% year-on-year in June (previous value 3.4%).

The dual benefits of a weak economy and cooling inflation are undoubtedly favorable for gold.

The Bank of Japan's Unexpected Intervention in the Dollar: On July 30, the Japanese government and central bank jointly intervened in the dollar exchange rate, causing the dollar index to plummet below 100, marking its largest single-day drop since January.

A weaker dollar immediately boosted gold prices.

Gold prices held the $4,000 support level four times: This indicates strong support below, making it difficult for bears to push prices lower further.

The bears' predicament:

Unprecedented divisions within the Federal Reserve: The July Federal Open Market Committee (FOMC) meeting decided to keep interest rates unchanged by a 9-3 vote, with three regional Fed presidents voting in favor—the largest number of dissenting votes since 2016. Warsh explicitly emphasized complete reliance on data, refusing to provide a clear policy path, causing market expectations for a September rate hike to hover between 58% and 60%.

High oil prices: Escalating conflict in the Middle East pushed Brent crude prices back above $84 per barrel, while persistent energy inflation concerns weighed on gold.

Technical Analysis: Still in a downtrend: Gold prices have not yet broken below the major downtrend line. Latest technical analysis: What's next for gold?

First resistance level: $4090-$4100

Strong resistance level: $4160

First support level: $4020-$4000

Second support level: $3960. A break below this second support level after $4000 will impact the overall trend.

Extreme target level: $3730-$3780

Trendline resistance level: $4201. A break above this resistance level would signal a true trend reversal.

Gold remains in a larger downtrend structure and is currently consolidating above key support levels. $3960 is a key support level—holding this level could lead to an ABC pattern after a bottoming out and rebound. A break below this area could see gold continue moving towards the Fibonacci target area of ​​$3730-$3780.

Gold may need to consolidate around $3800 to find stronger support, with a new round of gains expected in the fall. Gold prices are currently in "extremely oversold" territory. Historically, gold prices typically bottom out and rebound in August, and new upward momentum is expected in late summer.

Next Week's Trading Strategy:

Core Assessment: The biggest catalyst next week will be the US July non-farm payroll report released on Friday (August 7th).

Prior to this, gold prices may continue to fluctuate within the $4020-$4120 range, awaiting directional confirmation.

Specific Strategy Ideas:

Strategy: Buy low and sell high within the range (range trading strategy)

At the beginning of this week, without any major news catalysts, the range-bound trading pattern is likely to continue:

Long Position Recommendation: If gold prices stabilize around $4000-$4020, consider establishing a small long position with a target price of $4090-$4100 and a stop-loss order below $3960.

Short Position Recommendation: If gold prices encounter resistance around $4090-$4100, consider establishing a small short position with a target price of $4020-$4000 and a stop-loss above $4160.

After a week of waiting, a pullback opportunity is imminent.

The key question is: Has this pullback ended, or has it not yet bottomed out?

This week we completed several range-bound trades. Our trading strategy was very clear: short at the highs and long at the lows.

This week we profited over 90 pips, with each lot yielding over $9000.

I believe gold prices may indeed need to fall to $3800 for a period of consolidation before rising again in the fall.

This may sound pessimistic, but it's not without reason.

Currently, the biggest issue in the market is the internal division within the Federal Reserve. The vote was 9-3, with neither the hawks nor the doves able to convince the other.

In this situation, large funds dare not make large-scale transactions and can only close their positions by trading between $4,000 and $4,200.