Daily Price Outlook
During the European trading session on Wednesday, gold prices remained steady, holding above the $2,900 mark as investors stayed cautious ahead of the highly anticipated US Consumer Price Index (CPI) report.
However, the upcoming inflation data will help determine the Fed's rate decisions, which will affect gold prices in the coming weeks.
Moreover, the risk-off mood in the market also helped keep gold prices high. The global market sentiment has been flashing red on the day amid combination of factors.
Gold Gains Support Amid US Tariff Impact on Steel and Aluminum
Gold also found support as trade tensions escalated following President Donald Trump’s 25% tariff on US steel and aluminum imports, which took effect on Wednesday.
The tariff, impacting a broad range of industrial and consumer goods, fueled concerns over a economic slowdown.
Initially, Trump proposed increasing tariffs on Canadian steel and aluminum to 50% in response to Ontario’s trade restrictions.
However, following negotiations, the US administration retracted the proposed hike, maintaining the 25% rate.
Therefore, the trade uncertainty has fueled concerns of a global economic downturn, further reinforcing gold’s status as a safe-haven asset.
US Dollar Stabilizes as Traders Await Key Inflation Data and Job Market Trends
On the US front, the broad-based US dollar gained modest traction but remained near the four-month low recorded last week.
Despite the dollar’s slight recovery, gold prices held steady, supported by risk aversion amid economic uncertainty.
On the data front, the US job openings increased by 232,000 to 7.740 million in January, according to the latest Job Openings and Labor Turnover Survey (JOLTS) report.
However, revisions showed fewer vacancies than previously estimated from January to December 2024. Despite strong hiring numbers, small business confidence dipped for the third consecutive month, reflecting concerns over trade policy volatility and fiscal uncertainties.
Traders are now closely watching the upcoming US inflation data, as it could influence the Fed’s rate decision. However, the lower-than-expected CPI reading may boost expectations for rate cuts, potentially driving gold prices higher. Conversely, stronger inflation data could strengthen the US dollar and cap gold’s.
GOLD (XAU/USD) – Technical Analysis
Gold (XAU/USD) is trading at $2,918.48, up 0.02%, as it hovers near its pivot point at $2,919.09. The metal remains in a tight range, with traders awaiting a decisive move amid shifting market sentiment.
The 50-day EMA at $2,908.68 suggests moderate downside pressure, with short-term selling opportunities emerging below the pivot.
On the upside, gold faces immediate resistance at $2,930.55, with additional barriers at $2,942.01 and $2,954.43. A break above these levels could trigger bullish momentum, targeting new highs. However, failure to surpass $2,930.55 may reinforce a bearish outlook.
Support lies at $2,902.12, with further downside levels at $2,891.50 and $2,880.40. A drop below $2,902.12 would confirm increased selling pressure, potentially accelerating losses toward lower support zones.
The pivot point at $2,919.09 serves as a key threshold—trading below it favors a bearish bias, while sustaining above it may shift momentum toward the bulls.
Given the technical setup, a sell position below $2,919 is favored, targeting $2,902 for a take-profit level, with a stop-loss placed at $2,930. Gold’s near-term movement will largely depend on U.S. inflation data and Federal Reserve signals, which could sway sentiment and drive volatility.
Related News
- EUR/USD Price Analysis – March 12, 2025
JOIN LHFX TODAY
24/7 live support, lightning fast withdrawals, guaranteed safe and reliable trading platforms with a true ECN broker.