As the traditional financial markets show signs of reversal, the gold market is beginning to lose its momentum. Recent geopolitical developments, particularly former President Donald Trump’s attempts to mediate between Russia and Ukraine and the announcement of a temporary pause on new tariffs, have significantly influenced investor sentiment. This shift has led to a broad cooling in safe-haven demand, naturally putting downward pressure on gold prices after an extended bullish run.
Gold, which had previously benefited from fears of escalating global conflict and inflation, has now experienced a sharp retracement of approximately 2,000 points from its recent highs. Traders are now questioning whether the current downward momentum could extend another 1,000 points and test the $3200 level this week.
This analysis explores the fundamental and technical factors shaping the gold market from April 28th to May 2nd, outlining critical buying and selling zones that traders should closely watch.
Key Economic Events Shaping the Gold Market This Week
This week is packed with major U.S. economic data releases, each of which holds the potential to introduce significant volatility to XAUUSD. On Tuesday, the Job Openings and Labor Turnover Survey (JOLTS) report will be released. A higher number of job openings would suggest labor market strength, typically boosting the U.S. dollar and putting pressure on gold. Conversely, a lower-than-expected figure would bolster gold’s appeal as a safe haven.
Wednesday will bring the release of key growth indicators: the Advance GDP (quarter-over-quarter) and GDP (month-over-month) reports. Strong GDP data could reaffirm the Federal Reserve’s hawkish stance, pressuring gold lower. Additionally, the Employment Cost Index (ECI) will be closely monitored, as a sharp rise in wages could stoke inflation fears and support gold prices temporarily.
Thursday’s ISM Manufacturing PMI will provide further insights into the strength of the U.S. economy. A weaker reading could dampen expectations of future rate hikes and thus favor gold. Alongside this, weekly unemployment claims data will help gauge labor market resilience, with higher claims potentially acting as a tailwind for gold prices.
The most critical release comes on Friday: the Non-Farm Payrolls (NFP) report. As the primary labor market metric, a strong NFP print could bolster the dollar and pressure gold, while signs of weakness could trigger a rally in safe-haven assets.
Brewing Tensions in the East and Their Impact on Gold
Beyond U.S. economic data, geopolitical tensions remain a significant driver of gold prices. While mediation efforts are underway between Russia and Ukraine, a new conflict appears to be emerging between India and Pakistan. Military buildups along the disputed Kashmir border following a tragic incident that claimed 26 civilian lives have reignited fears of escalation between the two nuclear-armed neighbors.
Given that Indian households collectively own an estimated 25,000 tonnes of gold—more than the combined reserves of the top 10 central banks—any escalation in the region could drive domestic gold demand sharply higher. As a result, rising geopolitical instability could act as a counterforce to the recent bearish technical signals, prolonging gold’s overall bullish narrative.
Higher Timeframe (HTF) Technical Overview for Gold
From a technical perspective, gold continues to flash warning signs of a deeper retracement, even though its broader fundamental backdrop remains supportive. The recent weekly candlestick closed bearish, signaling that buyers are losing momentum. While it did not fully engulf the previous bullish candle, the pattern nonetheless indicates a possible continuation of the current pullback phase.
Using Fibonacci retracement analysis from the start of the recent rally to the $3500 peak, gold has already bounced from the 0.236 retracement level last week. However, the next key level of interest lies at the 0.382 Fibonacci zone around $3154.78—a natural magnet for price if selling pressure persists this week.
Gold Price Forecast for April 28th to May 2nd
After the initial pullback, gold is entering a critical zone where fresh buy-side liquidity is likely to emerge. Focusing on the 4-hour chart, immediate support is identified between $3247 and $3193. This zone coincides with a major point of control (POC) at $3226, providing a strong technical floor that could trigger a 200–500 point bounce if tested.
Should bearish momentum deepen, traders will eye the $3165–$3124 region for stronger support. This zone is reinforced by a 4-hour breaker block and a Fair Value Gap (FVG), with $3124 marking the swing’s Value Area High. Losing $3124 decisively would likely open the door for a more extensive correction towards the $3009 level, making this zone critical for bulls to defend.
On the upside, the first selling opportunity arises between $3342 and $3353. If gold drops below $3260 on the 1-hour chart and closes beneath it, this bearish order block becomes a prime shorting area. Traders should monitor price action closely around these key zones to time entries and exits effectively.
Trading Strategy and Investment Recommendations
Given the current market conditions, the safest approach is to align with the broader bullish trend by focusing on buy setups at higher timeframe supports, while seeking short-term sell opportunities within lower timeframe bearish zones.
Key Support Levels:
- $3245 – 4-hour breaker block
- $3165 – 4-hour Fair Value Gap and breaker block
Key Resistance Levels:
- $3342–$3353 – 1-hour Order Block and FVG
In conclusion, despite the short-term bearish pullback, gold maintains a fundamentally bullish outlook supported by global uncertainty and strategic accumulation trends. Traders should remain flexible, watching for key support and resistance interactions while staying alert to major economic data and geopolitical developments. These factors will be pivotal in determining whether gold retests $3500 or dives further toward $3200 in the days ahead.
