XAU/USD Weekly Outlook & Strategic Trade Planner (June

16-20, 2025)

The Macro-Fundamental Landscape: A Confluence of Fear and

Fed Focus

The trading week of June 16-20, 2025, presents a complex and potentially volatile
environment for Gold (XAU/USD). The precious metal's price action is being dictated
by a powerful confluence of acute geopolitical risk and intense speculation
surrounding the future path of U.S. monetary policy. While the underlying trend
remains firmly bullish, traders must navigate a landscape where sudden headline risk
from the Middle East could clash with a pivotal mid-week announcement from the
U.S. Federal Reserve. Understanding the interplay between these dominant themes is
paramount to formulating a successful trading strategy for the week ahead. This
analysis will dissect the key fundamental drivers, from the safe-haven flows fueling
gold's ascent to the high-stakes Federal Open Market Committee (FOMC) meeting
that could either supercharge the rally or trigger a sharp, contrarian correction.

The Geopolitical Cauldron: Safe-Haven Demand as the Primary Driver

The primary force providing a powerful tailwind for gold is the significant geopolitical
risk premium currently embedded in the market.1 The escalating military conflict
between Israel and Iran has become the dominant narrative, triggering a classic
flight-to-safety that has propelled gold to the forefront of investors' minds.2 Recent
market activity confirms that this tension is the principal catalyst behind gold's recent
surge, which has seen it break through key psychological levels, such as $3,400 per
ounce globally and ₹1,00,000 per 10 grams in India, and reach near two-month
highs.2
Analysts have explicitly noted that the "joint political risk premium" arising from the
conflict is directly boosting safe-haven demand for the precious metal.6 This is not a
background consideration; it is the active, primary driver that is overshadowing other
economic data points and providing a strong, supportive floor under the market.2 The
dynamic is expected to persist as long as the conflict shows no clear signs of de-
escalation, with traders and investors viewing gold as an essential hedge against the
uncertainty.1

The persistent and unpredictable nature of the Israel-Iran conflict creates a powerful
undercurrent in the market, shaping trader psychology in a profound way. This
environment establishes a strong belief among market participants that any
significant price dip in gold will likely be met with aggressive buying from those
seeking to hedge against the risk of a sudden, negative headline or a further
escalation of hostilities.5 This dynamic fundamentally alters the risk-reward
calculation for traders. Attempting to short gold in such a tense geopolitical climate
becomes an exceptionally high-risk proposition, as an unforeseen event could trigger
an immediate and explosive rally. Conversely, this market psychology encourages a
"buy the dip" mentality. Traders feel a greater degree of confidence entering long
positions during price pullbacks, believing that the underlying safe-haven demand
provides a reliable safety net that will ultimately propel prices higher. This behavior
can create a self-fulfilling prophecy, where the expectation of support at lower levels
generates the very buying pressure needed to create that support.1

The Federal Reserve's Mid-Week Verdict: The Week's Most Critical Event

While geopolitics provides the underlying bullish sentiment, the week's most critical
and potentially market-altering event is the Federal Open Market Committee (FOMC)
interest rate decision, scheduled for Wednesday, June 18.9 There is a broad and firm
consensus that the Fed will hold the federal funds rate steady in its current range,
with the target rate expected to remain at 4.50%.11 Consequently, the market's focus
will not be on the rate decision itself, which is widely considered a foregone
conclusion. Instead, all attention will be intensely focused on the nuances of the
accompanying monetary policy statement, the updated Summary of Economic
Projections (SEP) which includes the influential "dot plot" of policymakers' rate
forecasts, and the subsequent press conference held by Chairman Jerome Powell.10
Market positioning heading into the meeting is decidedly dovish. Despite inflation
remaining above the Fed's 2% target, currently at 2.4%, and a labor market that
continues to show resilience, money managers and futures markets are pricing in the
likelihood of rate cuts beginning in the second half of 2025.9 Futures market pricing
suggests a significant probability of the first 25-basis-point cut occurring as early as
the September meeting.6 Any language from the Fed that appears to validate this
dovish timeline—for instance, by acknowledging cooling inflation or expressing
concern about future growth—would likely exert downward pressure on the U.S.
Dollar and be highly bullish for non-yielding assets like gold.

Given that the market has largely priced in a "dovish hold," the most significant risk to
the prevailing bullish trend in XAU/USD comes from a contrarian outcome: a "hawkish
hold." The Federal Reserve has legitimate reasons to adopt a more cautious, or
hawkish, stance. Persistent inflation remains a primary concern, the labor market has
proven robust, and uncertainty surrounding the economic impact of trade tariffs adds
another layer of potential inflationary pressure.9 If Chairman Powell's press
conference and the FOMC statement place a heavy emphasis on these factors, while
downplaying the urgency for rate cuts and pushing back against the market's
aggressive easing timeline, it would represent a major surprise.

Market surprises, by their nature, force rapid and often violent repositioning. A
hawkish surprise would compel traders to quickly recalibrate their expectations,
pricing out the probability of imminent rate cuts. This repricing would almost certainly
manifest as a sharp and sudden spike in the U.S. Dollar Index (DXY) and U.S. Treasury
yields. Such a move would create a powerful and immediate headwind for XAU/USD,
which is priced in dollars and has an inverse correlation with yields, potentially
triggering a steep price drop as the market digests the unexpected shift in the Fed's
outlook.

High-Impact Data Docket: Gauging the US Economy's Pulse

Beyond the pivotal FOMC meeting, the week's economic calendar is populated with
several other high-impact U.S. data releases. These reports will provide crucial, real-
time insights into the health of the American economy, particularly concerning
consumer spending and industrial activity, which will in turn influence future Fed
policy expectations.9
The key data points to monitor include May's Retail Sales figures, which serve as a
direct barometer of consumer health. A weaker-than-expected reading would
reinforce the narrative that the economy is slowing, thereby strengthening the case
for Fed rate cuts and providing support for gold. Conversely, a surprisingly strong
number could temper dovish expectations. Similarly, Industrial Production and
housing market data will add further color to the overall economic picture. The table
below consolidates the most critical, market-moving events for the week, providing a
roadmap for traders to anticipate periods of heightened volatility. All times are listed
in Eastern Daylight Time (EDT).

Day Time Currenc Event Impact Consens Previous Potential

(EDT) y us XAU/US
D
Impact

Mon 8:30 AM USD Empire Med -5.9 -9.2 A result

State weaker
Manufac than
turing consens
Index us would
be
negative
for the
USD and
thus
positive
for
XAU/US
D. 11

Tue 8:30 AM USD Core High 0.1% 0.2% A miss

Retail to the
Sales downsid
m/m e would
(May) signal
consum
er
weaknes
s,
reinforci
ng
dovish
 Fed bets
and
supporti
ng gold.
11

Tue 8:30 AM USD Retail High -0.6% 0.1% A

Sales significa
m/m nt miss
(May) on the
headline
number
would
be
strongly
bullish
for gold.
11

Wed 8:30 AM USD Building Med 1.41M 1.43M Data will

Permits likely be
(May) oversha
dowed
by the
impendi
ng
FOMC
decision.
11

Wed 2:00 PM USD Federal Max 4.50% 4.50% The rate

Funds hold is
Rate expecte
Decisio d; focus
n is
entirely
on the
accomp
anying
stateme
nt and
economi
c
projecti
 ons. 10

Wed 2:30 PM USD FOMC Max - - Chairma

Press n
Confere Powell's
nce tone
(dovish
vs.
hawkish)
will be
the
primary
market
driver
for the
week. 10

Thu All Day USD Bank - - - Expect

Holiday lower
(Junete liquidity
enth) in USD
pairs,
which
can lead
to
potential
ly erratic
or
subdued
price
moveme
nts. 9

Fri 8:30 AM USD Philly Med -1.0 -4.0 A

Fed weaker-
Manufac than-
turing forecast
Index reading
would
cap the
week
with a
USD-
negative
 /XAU-
positive
signal. 10

The Dollar and Yields Equation: A Persistent Headwind for USD

The valuation of the U.S. Dollar Index (DXY) is a critical variable in the XAU/USD
equation. Because gold is priced globally in U.S. dollars, a weaker dollar makes the
precious metal cheaper for holders of other currencies, which typically increases
demand and pushes its price higher. At present, the DXY is exhibiting notable
technical weakness. It is trading within a well-defined descending channel and
remains below key long-term resistance levels, indicating persistent bearish
pressure.3 With the index hovering in the 97.80 to 98.00 range, this underlying
weakness in the dollar is providing a significant and fundamental tailwind for gold's
rally.17

Meanwhile, U.S. Treasury yields, another key driver for gold, are in a state of
consolidation. The benchmark 10-Year Treasury yield has been trading around the
4.4% level.20 Rising yields typically act as a headwind for gold because they increase
the opportunity cost of holding a non-yielding asset. However, the current
consolidation phase suggests that yields are not a primary driver of price action at
this moment. The market will be watching for a decisive breakout from this range
following the FOMC announcement. A significant drop in yields would remove a key
source of resistance for gold and would be interpreted as a strongly bullish signal.

Institutional Sentiment: The "Smart Money" is Long Gold

An examination of institutional positioning reveals a strong consensus that favors

higher gold prices. This sentiment is evident across two key domains: strategic
central bank acquisitions and speculative positioning in the futures market.

Firstly, data from the World Gold Council confirms that global central banks have
remained steadfast net buyers of gold, a trend that has been in place for years and
continued robustly through the first quarter of 2025.23 This activity is not short-term
speculation; it represents a long-term strategic shift by official institutions,
particularly in emerging markets like China, to diversify reserves away from the U.S.
dollar and hedge against global economic and geopolitical uncertainty.26 This
consistent, price-inelastic buying provides a formidable and durable support base for
the gold market.

Secondly, the latest Commitment of Traders (COT) report from the Commodity
Futures Trading Commission (CFTC) provides a snapshot of positioning in the futures
market. As of the week ending June 13, 2025, the data shows that large speculators, a
category that includes hedge funds and other money managers often referred to as
"smart money," hold a substantial net long position of 187,500 contracts.28 This
indicates that the speculative community is overwhelmingly positioned for a
continued rise in gold prices, providing a strong confirmation of the prevailing bullish
trend.

However, while this strong speculative bullishness is a positive sign, its sheer
extremity introduces a potential vulnerability. When a trade becomes overwhelmingly
one-sided, it is often referred to as a "crowded trade." This situation implies that
most of the potential buyers may have already entered the market, which can reduce
the available "fuel" for further upside moves. More importantly, it makes the market
structure fragile and susceptible to a "long squeeze" in the event of an unexpected
bearish catalyst. A long squeeze is a rapid price drop fueled by a cascade of selling,
as a large number of long position holders are forced to liquidate their positions
simultaneously. If a surprise event, such as the "hawkish hold" scenario outlined
earlier, were to occur, it could trigger stop-loss orders from the most weakly
positioned longs. This initial selling would then force other longs to exit, creating a
domino effect of selling pressure and a sharp, sudden decline in price. Therefore, the
bullish COT data, while confirming the trend, must also be viewed with an awareness
of this contrarian risk.

Deconstructing the XAU/USD Chart: A Multi-Timeframe

Technical Analysis
While fundamental analysis explains why the market might move, technical analysis
reveals where and how those moves are likely to occur. By dissecting the XAU/USD
price chart across multiple timeframes, we can identify the prevailing trend, pinpoint
key structural levels, and define high-probability zones for trade execution. This
section will begin by defining the core technical concepts used in this analysis before
applying them to the current market landscape.

Defining the Technical Toolkit

To ensure clarity, the following technical concepts form the foundation of this
analysis:
● Support and Resistance: These are fundamental concepts in technical analysis
representing price levels or zones on a chart where the forces of supply and
demand are expected to meet.30 Support acts as a price floor where buying
interest is anticipated to be strong enough to halt a decline, while resistance acts
as a price ceiling where selling pressure is expected to cap an advance.31 A
crucial principle is role reversal: once a resistance level is decisively broken, it
often transforms into a new support level, and conversely, a broken support level
can become new resistance.30 These levels gain significance the more times they
are tested and the longer the timeframe on which they appear.32
● Breakout: A breakout is a potential trading opportunity that occurs when an
asset's price moves decisively beyond a defined support or resistance level, often
accompanied by an increase in trading volume.36 This action signals that the
balance between buyers and sellers has shifted, and it is often the starting point
for increased volatility and a new price trend in the direction of the break.38
● Market Structure (BOS & CHOCH): Market structure analysis involves
interpreting the trend by observing the sequence of swing highs and swing lows.
In an uptrend, the market forms a pattern of higher highs (HH) and higher lows
(HL). A Break of Structure (BOS) occurs when the price moves above the
previous higher high, confirming the continuation and strength of the bullish
trend.40 In a downtrend, the market creates lower lows (LL) and lower highs (LH),
and a bearish BOS confirms trend continuation to the downside.42 A
Change of Character (CHOCH) is often the first warning sign of a potential
trend reversal. It occurs when an uptrend, for example, fails to create a new
higher high and instead breaks below the most recent higher low, indicating a
 potential shift in momentum from buyers to sellers.42
● Fair Value Gaps (FVG): A Fair Value Gap is a specific three-candle pattern that
identifies a price inefficiency or imbalance in the market.43 It is formed when there
is a large, aggressive price move (the middle candle) that leaves a gap between
the wick of the first candle and the wick of the third candle.45 These gaps
represent areas where price traded inefficiently, often due to large institutional
orders, and they tend to act as powerful magnets for price in the future. Traders
frequently look for entry opportunities when the price pulls back to "fill" this FVG,
as it is seen as a high-probability zone for the original trend to resume.47
● Pullback: A pullback is a temporary, short-term price correction that moves
against the direction of the prevailing trend.48 For instance, a brief dip within a
larger uptrend is a pullback. It is crucial to distinguish a pullback, which is a
healthy and temporary pause, from a reversal, which is a more significant and
long-term change in trend direction.50 Pullbacks are often viewed by trend-
following traders as opportunities to enter a position at a more favorable price
before the primary trend resumes.51

The Strategic View (Daily Chart): The Dominant Bullish Trend

An analysis of the daily chart for XAU/USD provides the strategic, long-term
perspective, and the picture is unequivocally bullish. The price action displays a clear
and consistent series of higher highs and higher lows, the textbook definition of an
uptrend.41 Most significantly, the recent powerful move that pushed the price
decisively above the $3,400 level constitutes a major

Bullish Break of Structure (BOS).42 This technical event serves as strong

confirmation that buyers are in firm control of the market's long-term trajectory and
that the path of least resistance is to the upside.

With this dominant bullish structure established, the key support and resistance
zones on the daily timeframe become critical reference points for the week:
● Major Resistance: The immediate upside obstacle is the recent high printed
near $3,446.53 A break above this level would signal a continuation of the rally.
Beyond that, the next significant target is the major psychological and round-
number resistance at
 $3,500, a level that analysts and traders are closely watching.3
● Major Support: Following the principle of role reversal, the previous resistance
area around $3,400 now serves as the first and most important line of support.34
Below this, the next significant support zone is the 50-day Simple Moving
Average (SMA), which is currently located around
$3,281.53 Should a deeper correction occur, the prior major swing low area,
spanning from approximately
$3,120 to $3,167, represents the ultimate structural support that must hold to
maintain the long-term bullish market structure.3

The Tactical View (4-Hour Chart): Identifying Pullback Zones

Zooming in to the 4-hour chart provides a more tactical view, offering greater clarity
on the recent impulsive rally and highlighting potential areas for pullbacks where
buyers might re-engage. The strong upward move was so aggressive that it inevitably
left behind market inefficiencies that price may seek to revisit. Some analysts have
noted that the rebound from the $3,120 area was highly constructive and have even
identified a potential inverted head-and-shoulders pattern, which is a classic bullish
reversal formation that adds weight to the positive outlook.3

Within this tactical timeframe, several key technical formations could shape price
action in the coming week:
● Symmetrical Triangle Potential: In the periods of consolidation that often
precede the next leg of a trend, the price could form a symmetrical triangle
pattern. This pattern is characterized by two converging trendlines—one
connecting a series of lower highs and the other connecting a series of higher
lows—indicating a temporary state of equilibrium and indecision in the market.54
While neutral on its own, a symmetrical triangle is typically considered a
continuation pattern, meaning a breakout above the upper trendline would
provide a clear, high-probability signal to enter a long position in alignment with
the broader uptrend.57
● Fair Value Gaps (FVGs): The recent aggressive rally has almost certainly left one
or more 4-Hour Fair Value Gaps below the current market price. These zones of
inefficiency, particularly those that were formed during the break of a prior
market structure, are high-probability targets for a price pullback.47 These FVGs
 represent areas where institutional buying was so strong that it overwhelmed
selling, leaving unfilled orders and an imbalance. Traders will be watching these
zones closely, as a pullback into an FVG often provides an excellent, low-risk
entry point to rejoin the dominant trend.44

The existence of these technical patterns is not a coincidence; they are the direct
footprint of the fundamental news catalysts that have been driving the market. The
aggressive, large-scale institutional buying that was spurred by the alarming
headlines from the Israel-Iran conflict is precisely what created these price
imbalances and Fair Value Gaps on the chart.43 This creates a powerful feedback loop
where the fundamental story and the technical picture reinforce one another. A major
geopolitical event prompts institutions to react with large, one-sided buy orders to
hedge their risk.43 This rapid buying pressure pushes the price up so quickly that it
leaves an FVG in its wake.46 Technical traders then identify this FVG as a high-
probability zone for a future pullback, viewing it as an area of unfilled institutional
interest.45 When the price does eventually pull back into this FVG, these technical
traders execute buy orders, anticipating a bounce. Their collective action provides
the buying pressure that helps fulfill the expectation that the FVG will act as support,
demonstrating a direct and powerful causal link between fundamental events and the
technical patterns they create.

High-Probability Entry Signals (1-Hour Chart): Pinpointing Entries

For precision in trade execution, the 1-hour chart is invaluable for pinpointing specific
entry triggers within the broader tactical zones identified on the 4-hour chart. The
most immediate and highest-probability entry strategy for the week is to exercise
patience and wait for a pullback to a pre-defined area of strong support.50 Chasing
the price at its recent highs is a low-probability approach.

The ideal entry zone would be located at a confluence of multiple technical factors.
This would include the horizontal support level at $3,400, which represents the
recently broken resistance, combined with any nearby 1-Hour Fair Value Gap that
was created during the ascent. An entry at such a confluence point significantly
increases the probability of a successful trade.

To further enhance the probability of an entry, traders should wait for a specific price
action confirmation signal within this zone. The appearance of a Bullish Engulfing
candlestick pattern would serve as a powerful trigger to enter a long position.59 This
two-candle pattern, where a large bullish candle completely engulfs the body of the
preceding bearish candle, signifies a decisive and powerful shift in momentum from
sellers to buyers at that specific price level.59 Its appearance at a key support level
often precedes a strong and sustained move higher, providing the final confirmation
that buyers have taken control and the pullback is likely over.60

Synthesizing the Analysis: Strategic Trade Scenarios for the

Week

By merging the fundamental "why" with the technical "where," we can formulate
clear, actionable, and high-probability trading scenarios for the week ahead. This
synthesis allows for a strategic approach that is aligned with the dominant market
forces while also accounting for potential contrarian outcomes.

Primary Bullish Scenario: Buying the Dip in a Strong Uptrend

This scenario represents the highest probability path for XAU/USD during the week. It
is built on the powerful alignment of multiple reinforcing factors: the dominant bullish
market structure confirmed by the recent Break of Structure (BOS); the strong
fundamental tailwind provided by geopolitical tensions driving safe-haven demand;
the underlying weakness in the U.S. Dollar Index (DXY); and the supportive
institutional positioning reflected in both central bank buying and speculative net long
positions in the futures market.

The core strategy for this scenario is not to chase the price at its highs, which carries
significant risk of entering at a temporary top. Instead, the prudent approach is to
patiently wait for a pullback to a well-defined area of technical value.50 The ideal
entry zone would be at the confluence of a horizontal support level, such as the
breakout point around
$3,400, and a technical inefficiency like a 4-Hour or 1-Hour Fair Value Gap.47 Entering
at such a location offers a more favorable risk-to-reward ratio.

This bullish scenario would be strongly validated and potentially accelerated by a

dovish-leaning outcome from the FOMC meeting on Wednesday. A statement or
press conference that reinforces market expectations for future rate cuts would likely
weaken the U.S. dollar further and add fuel to the gold rally. Simultaneously, any
continuation or escalation of geopolitical tensions in the Middle East would serve to
reinforce the safe-haven bid, providing a continuous supportive undercurrent for the
price.

Contrarian Bearish Scenario: The "Hawkish Hold" Reversal

This is a lower-probability but potentially high-impact scenario that traders must be

prepared for. It is predicated on the risk of a "Hawkish Hold" from the Federal
Reserve, as discussed in the fundamental analysis. If the Fed surprises the market
with a hawkish tone that pushes back against rate cut expectations, it could act as
the catalyst to trigger the "Crowded Trade" risk, potentially leading to a rapid long
squeeze as over-leveraged bulls rush for the exits.

A trade based on this scenario should only be considered if there is a clear and
decisive Change of Character (CHOCH) on the 4-hour or daily chart.42 This would
require more than just a minor dip; it would involve a confirmed break

below the key structural support level at $3,400. A subsequent break of the next
significant swing low would further confirm the reversal. A decisive move below the
50-day SMA at approximately $3,281 would be a very strong signal that a deeper,
more significant trend reversal is underway.

The entry trigger for a short position in this scenario would be to wait for the price to
retest the broken support level, which would now be expected to act as new
resistance. For example, after a confirmed breakdown below $3,400, a trader would
wait for price to rally back up to retest the $3,400 level from below before initiating a
short position.
Risk Management: The Non-Negotiable Element

Effective risk management is the cornerstone of any successful trading strategy and
is non-negotiable in a volatile market.
● For Long Positions: Stop-loss orders must be placed at a logical point below a
valid market structure low. For instance, if entering a long position on a pullback
to the $3,400 area, the stop-loss should be placed defensively below the most
recent significant swing low on the 4-hour or 1-hour chart, such as below $3,350
or a similar structurally sound point.33 This placement ensures that the trade is
protected from a deeper-than-expected correction or a full-blown reversal, while
still giving the position enough room to withstand normal market fluctuations.56
● For Short Positions: In the contrarian bearish scenario, a stop-loss order should
be placed just above the high of the retest candle that triggered the short entry.
This is critical because it ensures that if the initial breakdown proves to be a
"fakeout"—where the price briefly dips below support only to quickly reclaim it—
the resulting loss is contained and managed effectively.37

XAU/USD Weekly Trading Plan: Buy/Sell Signal Table

The following table synthesizes the entire fundamental and technical analysis into a
clear, concise, and actionable trading plan for the week of June 16-20, 2025. This
plan outlines specific, conditional scenarios for entering buy or sell positions,
complete with entry triggers, profit targets, stop-loss levels, and the core rationale
behind each setup. This structured format is designed to facilitate disciplined and
strategic trade execution.

Setup Type Action Entry Trigger Primary Stop-Loss Core

& Zone Target(s) Level Rationale &
Confirmation

1. Bullish BUY Enter Long T1: $3,446 Place Stop- Aligns with
Continuatio on a (Recent Loss below the
n Pullback pullback into High) the prior 4H dominant
(Primary the T2: $3,500 swing low, daily uptrend
Scenario) confluence (Psychologic e.g., $3,345. (Bullish
of horizontal al Level) 33 BOS).
support and T3: $3,603 Leverages
a Fair Value (Fib. geopolitical
Gap (FVG) in Extension) 1 safe-haven
the $3,380 - demand.
$3,410 Confirmatio
zone. 48 n: Dovish
FOMC
outcome;
DXY remains
below 98.50;
Bullish
candlestick
pattern (e.g.,
Bullish
Engulfing) in
the entry
zone. 42

2. Bullish BUY Enter Long T1: $3,500 Place Stop- A

Breakout on a T2: $3,603 1 Loss below continuation
confirmed 4- the breakout of strong
hour candle candle's low, bullish
close above e.g., $3,420. momentum,
the $3,450 56 often
resistance triggered by
level. 37 a fresh
geopolitical
escalation or
very dovish
Fed.
Confirmatio
n: Breakout
must occur
on high
volume. 37

3. SELL Enter Short T1: $3,300 Place Stop- This setup is

Contrarian ONLY after a T2: $3,281 Loss above ONLY valid if
Bearish confirmed 4- (50-Day the high of the bullish
Reversal hour candle SMA) 1 the retest structure
(Lower close below candle, e.g., breaks
Probability) the $3,380 $3,415. 37 (Change of
 support, Character).
followed by Confirmatio
a retest of n: Requires a
this level as surprisingly
new hawkish
resistance. 34 FOMC
statement,
causing a
sharp spike
in the DXY
above 99.00
and a
breakdown
in gold's
price
structure. 42

4. Range- NEUTRAL / Avoid N/A N/A Markets

Bound (Pre- NO TRADE initiating often
FOMC) new trades experience
in the hours low liquidity
leading up to and erratic,
the FOMC unpredictabl
announceme e price
nt on action
Wednesday. before a
major central
bank event.
It is prudent
to wait for
the event's
outcome and
the market's
reaction
before
committing
capital. 9

Conclusion
The outlook for XAU/USD for the week of June 16-20, 2025, is overwhelmingly bullish,
yet fraught with event risk that demands a cautious and strategic approach. The
dominant driver remains the powerful safe-haven demand stemming from acute
geopolitical tensions in the Middle East, which has established a strong supportive
floor for gold prices. This fundamental tailwind is reinforced by a technically weak U.S.
Dollar and strong institutional buying from both central banks and speculative
traders.

The primary and highest-probability trading strategy is to align with this dominant
bullish trend by seeking to buy on pullbacks to well-defined technical support zones,
particularly the area between $3,380 and $3,410. However, the week's pivotal event—
the FOMC monetary policy decision on Wednesday—presents the most significant
risk. While the market anticipates a dovish hold from the Federal Reserve, a surprise
hawkish tone from Chairman Powell could trigger a sharp, albeit likely temporary, sell-
off.

Therefore, discipline and risk management are paramount. Traders should avoid
chasing prices at their highs and instead wait patiently for high-probability setups to
emerge at key levels. The provided trading plan offers a clear framework for
navigating both the primary bullish scenario and the lower-probability contrarian
reversal. By remaining aware of the fundamental catalysts and adhering to a
structured technical plan, traders can position themselves to capitalize on the
opportunities presented by this volatile and dynamic market environment.

Works cited

1. Gold forecast: Upside risks persist amid Middle East tensions - FOREX.com,
accessed on June 16, 2025,
https://www.forex.com/en-us/news-and-analysis/gold-forecast-upside-risks-
persist-amid-middle-east-tensions/
2. Gold price prediction: What's the gold rate outlook for June 16, 2025 week
amidst Israel-Iran conflict - should you buy or sell? - Times of India, accessed on
June 16, 2025, https://timesofindia.indiatimes.com/business/india-business/gold-
price-prediction-what-is-the-gold-rate-outlook-for-june-16-2025-week-
should-you-buy-or-sell-mcx-gold-iran-israel-conflict/articleshow/121873277.cms
3. Gold (XAUUSD) Breaks $3,400 as Iran-Israel Conflict and Weak US Dollar Boost
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