Gold Retreats as Dollar Hits Three-Year Low and Technical Breakdown Accelerates

Gold prices dropped in the last 24 hours, with spot gold trading at $3,296 per ounce early Friday, June 27, 2025. This decline came as the US Dollar Index (DXY) fell to 97.3, its lowest level since March 2022.

Data from official sources confirm that the dollar weakened by more than 2% over the past month and nearly 8% over the last year. The dollar’s slide reflects growing expectations for Federal Reserve rate cuts and rising political uncertainty in the United States.

Recent US economic data have shown a 0.5% drop in first-quarter GDP and a rise in unemployment claims. These figures have increased market bets on a July rate cut, with traders now pricing in 64 basis points of easing by year-end.

Uncertainty over the Federal Reserve’s leadership has added to the dollar’s weakness, as speculation grows about a possible change at the top. Despite the weaker dollar, gold failed to attract strong safe-haven flows.

The main reason is the easing of geopolitical tensions after the Israel-Iran ceasefire, which removed a key risk premium that had supported gold earlier in June. Investor focus has shifted to the upcoming US core PCE inflation data, which could influence the Fed’s next move.

Technical analysis of the daily chart shows gold has broken below the 50-day simple moving average at $3,324, a support level that had held since April. The price now sits just above the lower Bollinger Band, indicating rising volatility and downside risk.

The Relative Strength Index (RSI) is at 44, showing weakening momentum. The Moving Average Convergence Divergence (MACD) histogram remains negative and is widening, confirming bearish momentum.

The Ichimoku Cloud still offers some support, but the price is close to the lower edge, raising the risk of a deeper correction. The 4-hour chart supports this bearish outlook.

Gold trades below both the 50-period and 200-period moving averages, and the RSI is at 34, close to oversold territory. The MACD remains negative, and the price has broken below a key horizontal support at $3,295, increasing the risk of a move toward the next support near $3,283.

ETF flows and futures volumes confirm the shift in sentiment. Outflows from gold-backed ETFs have accelerated, and speculative long positions on futures have declined as investors rotate into equities and other precious metals.

Silver and platinum have outperformed gold in recent weeks, attracting more trading interest. In summary, gold’s decline over the past day reflects a technical breakdown, a weaker dollar, and fading geopolitical risk.

The market’s attention now turns to US inflation data for further direction. If support at $3,283 fails, gold could see additional selling pressure in the coming sessions.

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