Gold prices crashed to $3,237.04 per ounce Monday, shedding 2.7% in their steepest single-day drop this year, after Washington and Beijing agreed to slash reciprocal tariffs.The US cut duties on Chinese goods from 145% to 30%, while China reduced its levies from 125% to 10%, sparking a global equity rally that drained bullions appeal.Asian markets led the sell-off, with Indian 24-karat gold plunging 6,500 per 10 grams from Aprils peak to 95,620.
Futures on the Multi Commodity Exchange hit 92,975, down 3.75% overnight.Silver bucked the trend, rising 1.34% to $33.00 per ounce as industrial demand optimism offset broader precious metal weakness.
Technical indicators turned decisively bearish, with the 100-day EMA breached at $3,215.The RSI sank to 41.63, while MACD hit -13.96, signaling sustained downward momentum.
Seventy-nine percent of moving averages now recommend selling.
Bulls lost their edge below $3,250 resistance, said Kitcos Jim Wyckoff, noting critical support at $3,211.Gold Plummets 2.7% as US-China Tariff Truce Erodes Safe-Haven Demand.
(Photo Internet reproduction)Dollar strength compounded pressures, with the DXY index hitting a one-month high.
Higher Treasury yields further discouraged non-interest-bearing gold holdings.Gold Stalls in Narrow Range as ETF Outflows EaseETF outflows moderated slightly to 5.82 crore in April, though AUM still grew 87% year-on-year as long-term investors held positions.
Market makers see limited near-term upside.Citi revised its three-month target to $3,150, forecasting range-bound trading between $3,000-$3,300.
Traders await US CPI data, expected to show inflation cooling to 3.1%, which could revive rate-cut bets.Gold needs geopolitical sparks to reignite, said KCMs Tim Waterer, noting truces in both US-China trade and Indo-Pak military tensions.
Despite the rout, physical demand emerged in Chennai where sovereign gold rose 120 overnight.Analysts caution that tariff reductions expire in 90 days, leaving room for renewed trade tensions.
With 24% year-to-date gains intact, bullions core inflation-hedge appeal keeps the door open for rebound plays below $3,200.