Daily Price Outlook
During the European trading session, the Gold prices (XAU/USD) maintained its upward trend and remained well bid above $3,450. Although the metal slightly retreated from its recent all-time high of $3,500, it continues to show strong demand as traders take a pause after recent gains, which pushed the market into short-term overbought territory. Despite this minor pullback, gold maintains a positive outlook due to ongoing global uncertainties.
However, the main reasons behind this upward momentum is the continued concern over US President Donald Trump's tariffs, which are creating worries about global economic stability. These trade tensions have led investors to seek safer investment options like gold.
Moreover, the persistent geopolitical conflict between Russia and Ukraine is adding to the uncertainty, further boosting the appeal of gold as a safe-haven asset. As a result, gold prices remain supported by a mix of economic and political risks, keeping the bullish bias intact.
Gold Price Surge Driven by US Tariff Fears and Trade Policy Uncertainty
On the US front, the uncertainty surrounding President Trump's tariff policies continues to play a major role in pushing gold prices higher. His frequent changes and unclear position on trade tariffs have created concerns about the future of the US economy. This has weakened investor confidence in the US Dollar (USD), which typically boosts demand for gold as a safe-haven asset.
In addition, President Trump's ongoing criticism of Federal Reserve Chair Jerome Powell has raised questions about the independence of the US central bank. Trump has been calling for lower interest rates and has shown clear frustration with Powell's decisions. These political pressures on the Fed have added to market uncertainty, encouraging more investors to move their money into gold for protection.
Another important factor supporting gold prices is the market's expectation of a more dovish approach from the Federal Reserve. According to the CME Group’s FedWatch Tool, traders are expecting a 25-basis-point interest rate cut in June, with the possibility of at least three more cuts in 2025. Lower interest rates reduce the opportunity cost of holding non-yielding assets like gold, making it more attractive.
Therefore, the combination of economic instability, political tension, and expectations of lower rates is driving steady demand for the precious metal.
Geopolitical Tensions and Economic Uncertainty Continue to Drive Gold Demand
In addition to trade policy uncertainty, escalating geopolitical tensions have provided additional support for gold. Recently, Russian forces launched a series of drone and missile attacks on Ukraine after a short ceasefire. These geopolitical events have heightened market fears, driving demand for safe-haven assets like gold.
Traders are now eyeing upcoming US economic data, including the Richmond Manufacturing Index and the flash PMIs, which could provide further insight into the health of the global economy and potentially affect gold’s price action.
Moving ahead, traders expect gold prices to stay supported due to ongoing trade tensions and rising geopolitical risks. Markets will keep a close watch on updates related to US trade policies, global conflicts, and the Federal Reserve’s next moves to get clues about where gold (XAU/USD) might head next.
GOLD (XAU/USD) – Technical Analysis
Gold continues to trend higher within a defined ascending channel, recently breaking above the $3,468 resistance and reaching an intraday high near $3,487. The bullish structure remains intact, with price consolidating just below the $3,494 resistance. As long as the $3,468 support level holds, the outlook favors further upside toward the $3,510 target.
The 50-period SMA, currently at $3,332, continues to slope upward, reinforcing bullish momentum. However, the RSI is at 81.23 — firmly in overbought territory — suggesting that some consolidation or a mild pullback could occur before a sustained breakout.
If price maintains above $3,468, bulls could drive the move toward $3,510 and potentially retest the upper channel boundary at $3,519. On the downside, a break below $3,468 would risk a slide to $3,457 and $3,440, where the lower bound of the trade setup sits.
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