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Commodities Gold

Gold Glitters at Record Highs as US-China Trade War and Fed Cut Speculation Fuel Rally

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  • April 11, 2025
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Gold prices are climbing near record highs at about $3,220 as tensions in the US-China trade war escalate and speculation of Federal Reserve rate cuts rises to drive demand for the safe-haven metal. The US Dollar remains weakening, and foreign investors find gold increasingly appealing, while softer-than-anticipated US inflation readings have made the case for monetary easing as early as June even stronger. In spite of a brief tariff reprieve for most US trading partners, the sudden spike in tariffs on Chinese imports has increased market uncertainty, further boosting gold’s bullish trend. With technicals signaling further upside, gold may be set to test the $3,250–$3,300 level in the near term. KEY LOOKOUTS • Momentum remains positive as the metal teases lifetime highs. A break above $3,250 on a sustained basis could set the stage for $3,300 and higher. • Weaker US inflation data spurs speculation of Fed rate cuts from June, with markets pricing up to 100 bps of cuts by year-end. • China’s retaliatory duties and the aggressive tariff increase of Chinese products by the US are escalating worldwide economic concerns, fostering safe-haven demand. • The DXY keeps declining, trading close to 100.20, as investors respond to trade volatility and mixed economic signs. Gold prices still fluctuate around historic highs at $3,220 with market sentiment remaining fueled by a combination of economic and geopolitical issues. The increasing US-China trade war, defined by reciprocal tariff increases, has increased worldwide uncertainty, prompting investors to turn towards safe-haven assets such as gold. While simultaneously, gentler-than-anticipated US inflation figures have enhanced hopes of Federal Reserve interest rate cuts beginning as early as June, fueling the rally of the metal even further. The weakening US Dollar, making gold cheaper for international buyers, joins the positive sentiment. With technical indicators still pointing toward upside space, gold may be in line to test the pivotal resistance point at $3,250 and possibly target $3,300 in the near term. Gold prices fluctuate near all-time highs of $3,220, supported by increasing US-China trade tensions and heightened hopes of Fed rate cuts. The weakening US Dollar and safe-haven demand still drive the bullish momentum of the metal. Focus now shifts to the $3,250 resistance level for the next break-out. • Gold prices are trading near all-time highs of $3,220 in the wake of increasing global uncertainty. • The heightening US-China trade conflict has prompted investor flight to safe-haven assets such as gold. • China responded with a 125% duty on US goods following the US imposition of a 145% charge on imports from China. • Weaker US inflation data has reinforced hopes of Federal Reserve interest rate reductions from June. • The US Dollar continues to deteriorate, making gold more desirable to foreign investors. • Policymakers at the Federal Reserve worry about reconciling inflation restraint with a weakening growth in the economy. • Gold is still in high demand as a protection against economic and geopolitical uncertainty. Gold prices are attracting firm investor attention as worldwide economic tensions escalate, led by the deepening US-China trade war. The most recent round of tariff hikes — with the US increasing duties to 145% on Chinese imports and China hitting back with a sharp 125% tariff on US goods — has introduced a new degree of uncertainty into world markets. These trends have renewed fears of dampening global growth and possible dislocations in international trade, causing investors to flock to safe havens such as gold, which historically does well during periods of geopolitical tension. XAU/USD DAILY PRICE CHART CHART SOURCE: TradingView Adding to the allure of gold is the changing economic outlook in the United States. Economic indicators most recently provided were softer than anticipated, solidifying expectations the Federal Reserve could start reducing interest rates as soon as June. The lower rates make assets that don’t pay interest, such as gold, more appealing since the cost opportunity of holding them is reduced. Coupled with a soft US Dollar and general concerns over economic deceleration, these forces are fueling rising demand for gold, making it a sought-after hedge in the uncertain world today. TECHNICAL ANALYSIS Gold is firmly bullish-trending, with the daily chart registering continuous upward momentum. The 14-day Relative Strength Index (RSI) is reaching overbought levels, indicating considerable buying interest yet potentially flashing signs of exhaustion if the rally is not paused. Key levels of support have moved higher, showing strong demand on dips. While near-term resistance is observed around the $3,250 psychological level, a decisive break above this level may spur a new round of buying demand. On the downside, any corrective falls are set to find support around $3,200 and lower still at the 21-day Simple Moving Average (SMA), which means the general trend is still very much in favor of bulls unless the levels are broken convincingly. FORECAST Gold is set to continue its rally in the near term courtesy of a combination of factors such as geopolitical tensions, the weakening US Dollar, and anticipated Federal Reserve rate reductions. If macroeconomic sentiment remains unclear and inflation keeps declining, gold may experience more investment inflows in search of shelter. A break above the psychological $3,250 level can pave the way for more advances, with the $3,300 level seeming like a reasonable medium-term objective. Ongoing safe-haven demand and global risk aversion might maintain pressure on the metal to rise. In spite of the powerful momentum, gold is subject to potential downside risk if any sudden pickup in US-China trade tensions or a better-than-anticipated recovery in US economic data were to occur. This would potentially lift the US Dollar and lower the chances of aggressive Fed rate cuts, both of which could become bearish for gold prices. On the other hand, if the ongoing rally is followed by profit-taking or technical indicators signal signs of being overbought, a short-term correction to $3,200 or even $3,000 cannot be eliminated. But such dips can be interpreted as buying opportunities, provided the overall economic situation remains weak.

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Currencies GBP/USD

Pound Sterling Rises Against 1.30 as Trump Tariff Concerns Weigh on US Dollar and Fed Outlook

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  • March 11, 2025
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The Pound Sterling maintains its bullish trend against the US Dollar, trading at a four-month high as investors prepare for major US inflation data. Increasing concerns of a tariff slowdown under President Trump have deepened dovish expectations on the Federal Reserve, with market participants increasingly factoring in a possible rate cut in May. At the same time, the Bank of England’s conservative but resolute approach to keeping policy tight in the face of ongoing wage-led inflation has supported confidence in the GBP. As the GBP/USD pair edges closer to the psychological 1.3000 level, future economic data from both the US and UK will be important in deciding the next direction. KEY LOOKOUTS • Traders increasingly wager on a May Fed rate cut as fear of Trump’s tariff-led economic slowdown grows. • Pound Sterling hardens near 1.2930, with the objective of crossing the key 1.3000 level in the face of ongoing BoE hawkish sentiment. • February CPI data will determine market expectations regarding Fed’s next steps and dictate wider USD sentiment. • Bank of England policymakers favor a gradual and cautious monetary policy unwinding, underpinning GBP outlook against global counterparts. The Pound Sterling is strengthening versus the US Dollar, trading around the 1.2930 level as anxiety heightens for an impending US economic slowdown brought on by proposed tariffs by ex-President Trump. This has pushed market speculation about a sooner-than-expected rate cut by the Federal Reserve with May now joining the list as a probable deadline. Conversely, the Bank of England takes a prudent but firm stance, with policymakers preferring a gradual pace in monetary loosening given sustained inflation pressures in the UK. As market participants wait for key US inflation and UK GDP reports, the GBP/USD currency pair remains highly bullish, targeting a breakout above the crucial psychological level of 1.3000. The Pound Sterling is trading close to 1.2930, gaining strength due to concerns of a Trump-induced US slowdown and increased Fed rate cut expectations. The Bank of England’s dovish approach also lends support to GBP momentum as markets wait for critical US inflation and UK GDP releases. • Pound Sterling is trading close to 1.2930, backed by hopes of an extended restrictive approach from the Bank of England. • US Dollar drops due to market anxiety of a tariff-driven economic slowdown in the United States under a Trump regime. • Fed rate cut expectations are on the rise, with a 51% chance of a May cut amidst dovish moods. • Investors wait for US CPI, expecting to influence the Fed’s monetary policy in view of lower inflation. • BoE policymakers prefer a measured policy unwind, taking a conservative stance even as inflation in the service sector remains persistent. • GBP/USD targets the 1.3000 resistance level, riding on bullish sentiment and solid market mood. • UK GDP and factory data on Friday, expected to post moderate growth and drive the Pound’s next direction. The Pound Sterling is strengthening against the US Dollar as market sentiment changes with increasing fears of a slowdown in the US economy. These concerns are primarily fueled by former President Donald Trump’s planned tariff agenda, which has created uncertainty regarding the future of trade and economic growth. Consequently, investors now increasingly anticipate the Federal Reserve to start reducing interest rates as soon as May, which shows a more dovish attitude towards US monetary policy. GBP/USD Daily Price Chart Chart Source: TradingView In the meantime, optimism in the Pound is also underpinned by the Bank of England’s prudent yet resolute attitude in keeping existing interest rates intact. Policymakers are confident that inflation, especially fueled by robust wage pressures, remains a threat to the UK economy and must be carefully watched. In light of BoE’s indicating a gradual transition to any impending policy adjustments, investors are keen on the performance of the Pound. Everybody now waits for the coming economic numbers from both the US and the UK, which will determine future market expectations. TECHNICAL ANALYSIS GBP/USD currency pair is displaying bullish strength as it trades above critical moving averages, reflecting a strong long-term positive trend. The pair is well supported around the 1.2930 area, with the next significant resistance at the psychological level of 1.3000. Momentum measures such as the Relative Strength Index (RSI) continue above the neutral zone, indicating that there is scope for further rally. On the negative side, earlier retracement levels can function as support if there is a pullback, maintaining the general outlook skewed towards buyers unless there is a big reversal pattern. FORECAST The GBP/USD pair has strong short-term bullish potential, particularly if future US economic releases, such as inflation and jobs data, continue to uphold hopes of a Fed rate reduction. A definitive break above the 1.3000 psychological level may open the way for additional gains, drawing in further bullish interest. Further backing from the Bank of England’s prudent policy stance and chronic domestic inflationary pressures in the UK can continue to reinforce the Pound, maintaining the trend in place. Although there is present bullish momentum, there could be downward risks should sentiment reverse or statistics surprise the investor community. A higher-than-expected US inflation report or any shift in the Fed’s sentiment could reactivate support for the US Dollar, pushing GBP/USD lower. Furthermore, should future UK GDP and factory data prove disappointing, then the appeal of the Pound would be undermined. Under these circumstances, the pair could experience downward correction toward previous support levels, forcing traders to reconsider the outlook.

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Commodities Gold

Gold price Struggles near record highs as USD gains, Fed Rate speculations in focus

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  • February 7, 2025
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The gold price XAU/USD has remained at near record levels but failed to make any real momentum as the US Dollar was slightly higher going into the US Nonfarm Payrolls report. Though trade war tensions and a general expectation for a Federal Reserve rate cut should keep the precious metal well supported, caution continues to prevail in bullish traders’ camp. Deteriorating US Treasury yields and persisting economic jitters remain supportive of safe-haven gold. However, the technical indicators provide an overbought reading-a precursor to near-term consolidation before an extended move, after which the key support levels at $2,855 and $2,800 will watch the breach down for further correction. KEY LOOKOUTS • The next NFP report will dictate the market expectations about the Fed’s rate path and, hence, the USD demand and the gold price direction in the near future. • Multiple Fed rate cuts by 2025 are supporting gold, but strong labor market data could alter this scenario. • Increasing geopolitical risks and retaliatory tariffs imposed by China on US goods improve the safe-haven appeal of gold, capping downside risks despite short-term USD strength. • Gold remains near record highs, but RSI signals overbought conditions, with key support at $2,855 and resistance near $2,900 for further momentum. Gold price remains near record highs as investors weigh multiple factors, including the upcoming US Nonfarm Payrolls (NFP) report, Federal Reserve rate cut expectations, and escalating US-China trade tensions. While the weakening US Treasury yields and safe-haven demand support gold, a modest USD uptick ahead of key economic data creates short-term uncertainty. Technical indicators suggest overbought conditions, signaling a potential consolidation before any further uptrend. Key support levels at $2,855 and $2,800 will be crucial in determining the next move, while resistance near $2,900 could challenge bullish momentum in the near term. Gold price lingers around record highs due to Fed rate cut expectations and trade tensions, yet it faces strong resistance from a modest USD uptick. Determinative key levels will be for the next step: $2,855 and $2,900. The technical indicators go even further to suggest short-term consolidation. • Gold refuses to hold its ground off the all-time high for a modest USD uptick. • Market speculations of several Fed rate cuts in 2025 support gold’s bullish view even with positive labor market numbers. • The NFP release will influence USD demand and is likely to push gold in one direction or another. • Growing geopolitical tensions, along with China’s retaliatory tariffs on US goods, will continue to boost gold’s safe-haven status. • Declining bond yields make non-yielding assets, such as gold, more appealing and add more support. • This RSI indication of overbuying could eventually lead to temporary consolidation before entering an extended rise. • Areas of support here are at the levels of $2,855 and $2,800 and resistance is capped near $2,900 for the bulls Gold price in XAU/USD stays almost at all time highs but under pressure due to a slight upside in the USD as investors focus on the NFP from the US. While positive expectations about rate cuts by the Federal Reserve and falling US Treasury yields continue to support the bullish outlook on metal, short-term consolidation seems probable because of technical overbought conditions. Apart from those factors, geopolitical risks, particularly increasing tensions in the US-China trade, continue to fuel safe-haven demand for gold, preventing a more significant downtrend despite some profit-taking. XAU/USD Daily Price Chart TradingView Prepared by ELLYANA The price of gold is trading close to record highs due to the expectations of cuts in the Federal Reserve rate and safe-haven demand amid US-China trade tensions. However, a modest increase in the US Dollar ahead of the Nonfarm Payrolls report has capped the further upside and thus the market sentiment is cautious. The technical indicators are also pointing towards an overbought situation, and a short-term pullback may occur before the next breakout. The important resistance levels are at $2,900 while support at $2,855 and $2,800 will definitely be the make or break situation. Traders are closely observing any significant change in economic data and geopolitical development which will define gold’s price action in the coming days. TECHNICAL ANALYSIS Gold price (XAU/USD) remains in a strong uptrend but faces resistance near the $2,900 level, while key support is seen at $2,855 and $2,800. The Relative Strength Index (RSI) shows that the market is overbought, so the price might enter into short-term consolidation before another breakout. A decisive move above $2,900 will open the way to further growth, while a break below $2,800 will trigger additional selling pressure. Although the moving averages stay aligned in favour of bulls and continue to confirm the overall bullish trend, traders should expect corrections before fresh long positions. FORECAST Gold prices remain in long-term bullish, supported by expected multiple Federal Reserve rate cuts, and declining U.S. Treasury yields. If the NFP data does indicate a weakness in the US labor market, it would bode well for gold, potentially pushing prices beyond the key resistance at $2,900. A sustained move above this would open the path for further rallies towards $2,950 and even $3,000 within the next week or so. Furthermore, growing US-China trade tensions and a general sense of economic uncertainty might keep demand pretty high for the yellow metal since investors are still looking for safety from market volatilities. Despite its strong rally, gold faces short-term downside risks due to overbought technical conditions, with the RSI signaling the possibility of a pullback. If the US Dollar strengthens further or NFP data beats expectations, gold could see a correction toward the $2,855 and $2,800 support levels. A decisive break below $2,800 could trigger additional selling pressure, potentially dragging prices toward $2,750 or lower. However, some fundamentals – such as monetary policy by central banks and political uncertainty – would be unlikely to let gold decline sharply and will keep the gold supported in the long term.

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