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XAU/USD: Gold Price Gains Momentum as Rate Cut Bets Intensify

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  • January 22, 2025
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Gold prices remain firm near multi-month highs, driven by safe-haven demand amid global trade uncertainties and expectations of rate cuts by the Federal Reserve. The uncertainty surrounding US President Donald Trump’s trade policies, coupled with fears of a fresh trade war, has boosted the appeal of the yellow metal. While a modest recovery in the US Dollar and rebounding Treasury yields pose minor headwinds, the overall bullish sentiment persists. Technically, a breakout above key resistance levels suggests further upside potential, with any corrective pullback likely viewed as a buying opportunity. The outlook remains favorable for gold, with bullish traders eyeing a potential challenge to the all-time high. KEY LOOKOUTS • Trade war fears and geopolitical uncertainties continue to drive investors towards gold, solidifying its status as a safe-haven asset amid global market volatility. • Expectations of two rate cuts by the Fed this year boost gold’s appeal, as lower interest rates reduce the opportunity cost of holding the non-yielding metal. • A break above $2,750 resistance may further intensify the bullishness of the market, and crucial support is seen near $2,720 and $2,690. • The Small bull recovery in the US Dollar may cap gold’s gains. Generally, dollar volatility is going to be a key watch for short-term direction. The gold market continues to hold near multi-month highs, supported by a global flight to safety amidst rising geopolitical concerns and a potential trade war. The potential for the US Federal Reserve to cut interest rates this year has also boosted the demand for gold, as non-yielding assets are favored under lower interest rates. A modest recovery in the US dollar and rebounding Treasury yields pose temporary headwinds, but overall sentiment remains bullish. Technically, a decisive breakout above the $2,750 resistance could pave the way for further gains, while support levels near $2,720 and $2,690 are key to sustaining the positive momentum. Gold prices remain near multi-month highs, supported by safe-haven demand and expectations of Fed rate cuts. A breakout above $2,750 could signal further gains, while $2,720 acts as key support. • Gold benefits from global uncertainties and trade war fears, attracting investors as a reliable safe-haven asset. • Expectations of two rate cuts this year enhance the appeal of gold by lowering the opportunity cost of holding the non-yielding metal. • Concerns over US trade policies and global trade wars drive sustained demand for the yellow metal. • A modest recovery in the US Dollar poses minor resistance to gold’s upward momentum. • A breakout above the $2,750 mark could trigger further bullish momentum in gold prices. • Price corrections may find support near $2,720 and $2,690, limiting potential downside risks. • Positive oscillators on the daily chart and a breakout through resistance zones point to continued bullish sentiment for gold. Gold prices remain resilient near multi-month highs, driven by robust safe-haven demand amid escalating geopolitical uncertainties and trade war fears. The concerns of markets over US President Donald Trump’s trade policies, including probable tariffs, continue to fuel interest in the yellow metal. Secondly, expectations for the Federal Reserve to cut twice this year support gold, as less interest reduces the opportunity cost to hold non-yielding assets. Despite a moderate bounce in the US Dollar and resurging US Treasury yields, the underlying remains conducive for more upside for gold prices. XAU/USD Daily Price Chart. Source: TradingView Prepared By ELLYANA Gold prices continue to trend upwards, boosted by strong safe haven demand amid concerns of a global trade war and the anticipation of a Federal Reserve rate cut. The recent breakout above the $2,720 resistance zone has reinforced bullish sentiment, with $2,750 emerging as the next critical level to watch. While a modest recovery in the US Dollar and rebounding Treasury yields may temporarily cap gains, the overall outlook remains positive. Technical indicators suggest room for further upside, with any pullbacks likely finding support near $2,720 and $2,690. Traders remain optimistic about a potential challenge to the all-time high of $2,790. TECHNICAL ANALYSIS From a technical perspective, gold prices have broken through key resistance levels, signaling strong bullish momentum. The recent breakout above the $2,720 supply zone acts as a trigger for further upside, with $2,750 emerging as the next significant resistance. The oscillators on the daily chart are still firmly in positive territory and show no signs of being overbought, which opens up more room for further gains. The key support levels are located near $2,720 and $2,690, and any corrective pullbacks are expected to attract buying interest. A sustained move above $2,750 could pave the way for gold to challenge the all-time high of $2,790, keeping the bullish outlook intact. FORECAST Prices for the yellow metal will likely remain positive, influenced by safe-haven demand due to continuing geopolitical uncertainty and trade war tensions. The non-yielding metal is also likely to be further supported by potential cuts from the Federal Reserve, as they reduce the opportunity cost of holding gold. Technically speaking, a follow-through above $2,750 may provide room to surge all the way up toward the record at $2,790 as more bullish oscillators will also leave much more upside left to come. The metal should see renewed interest to purchase as gold attracts the bullish capital on further rallies into such an unpredictable market period. Positive drivers notwithstanding, the rebound in the US Dollar and ongoing recovery in US Treasury yields could dampen the upside a bit in the short term, unless the support above the $2,720-$2,690 range can be sustained. If that breaks down, technical selling would ensue, taking the price all the way to the $2,660 zone. Other downside risks will arise if the risk-on environment can intensify from lower tensions or more positive than expected economic data. In such a scenario, prices of gold would retrace back towards the $2,625 confluence, being a critical juncture that forms the 100-day EMA and an ascending trendline – which may act as a decisive point for determination of the future directional move.

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Commodities Gold

Gold Shines Bright: XAU/USD Hits Over Two-Month High Amid Trade War Fears

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  • January 21, 2025
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Gold (XAU/USD) rises steadily above $2,725 to more than a two-month high, supported by rising fears over the trade war between the US and others after US President Donald Trump’s tariff remarks, in which Trump threatens tariffs on Canada, Mexico, and China. This boosts demand for safe-haven assets. Bets on possible Federal Reserve rate cuts further drive gold’s upward momentum, and a modest US Dollar recovery with a positive risk tone in the equity markets capped additional gains. Technical indicators have gold’s way still going up towards $2,735 and $2,746. Any pullback may, however, find support around $2,700 to keep the bullish sentiment in place. KEY LOOKOUTS • Technical analysis points to further upside, with key resistance levels at $2,735 and $2,746 in focus. • Trump’s tariff threats on Canada, Mexico, and China boost safe-haven demand, keeping gold prices elevated above $2,720. • Declining bond yields and expectations of two Fed rate cuts in 2025 underpin gold’s bullish momentum. • Any pullback may find strong support at $2,700, with further downside risks limited near $2,660-$2,635 zones. Prices for the precious metal gold (XAU/USD) remain high as trade war anxiety and expectation of rate cuts from the US Federal Reserve spur upward momentum. Tariff threats made by US President Donald Trump to Canada, Mexico, and China have upped demand for safe-haven assets, thus forcing gold into its two-month peak above $2,725. Falling yields for US Treasuries and growing inflation worries fuel the surge. Technical analysis indicates that there are potential gains towards resistance levels at $2,735 and $2,746. Pullbacks might find solid support near $2,700. The fundamental outlook is still tilted in favor of the gold bulls, even though a modest US Dollar recovery and a positive risk tone in equities have been reported. Gold prices (XAU/USD) surge past $2,725 amid trade war fears and Fed rate cut expectations. Safe-haven demand drives bullish momentum, with resistance at $2,735-$2,746 and strong support near $2,700. • XAU/USD surpasses $2,725, driven by escalating trade war fears and safe-haven demand. • Threats of tariffs on Canada, Mexico, and China increase market uncertainty, boosting gold prices. • Declining US bond yields signal possible rate cuts, supporting the non-yielding yellow metal. • The key resistance lies at $2,735 and $2,746, which may test the October 2024 highs near $2,790. • Pullbacks are likely to find strong support at $2,700, with further downside limited near $2,660-$2,635. • A slight rebound in the USD caps gold’s gains, but overall sentiment favors bullish momentum. • Ceasefire deals and hopes for geopolitical de-escalation limit aggressive bullish bets despite gold’s favorable outlook. The prices of gold have risen above $2,725, the two-month high, amid increasing trade war fears and rising safe-haven demand. US President Donald Trump’s threat of tariffs on Canada, Mexico, and China has jolted the markets, pushing investors towards gold as a safe asset. The expectation of rate cuts by the Federal Reserve following a drop in US Treasury yields has also helped boost the bullish momentum of the yellow metal. Despite a weak recovery in the US Dollar, the fundamental rationale remains positive for gold, given that traders and investors are factoring in inflation risks due to protectionist policies. XAU/USD Daily Price Chart. Source: TradingView, Prepared By ELLYANA From a technical perspective, gold prices now trade firmly above the $2,720 resistance zone, signaling potential for further gains. Key resistance levels lie at $2,735 and $2,746, where a challenge to the October 2024 peak at $2,790 may be made. Any correction down is expected to find support strong at $2,700, with any deeper decline capped near $2,660-$2,635. Geopolitical news flow – ceasefire deals and trade negotiations – may ease the bullishness but the overall trend remains in favor of gold. TECHNICAL ANALYSIS In a technical analysis context, gold prices (XAU/USD) have broken out above the resistance zone of $2,720, which seems to be opening up the channel for further bull runs. On the daily chart, oscillators are picking up positive momentum while still below the overbought levels, providing further upside scope. First resistance is expected at $2,735 followed by the zone of $2,746-$2,748 with possible extensions towards the peak of October 2024, at $2,790. On the negative side, $2,700 remains a good support level, while further supports at $2,660-$2,635 match the 100-day EMA and an ascending trendline from the November low. This technical configuration indicates that the least action path for gold continues to be on the upside. FORECAST Gold prices (XAU/USD) are expected to continue with its bullish drive and immediate resistance remains at $2,735, while a further zone at $2,746-$2,748 would act as resistance. A sustained break above these levels could set up a retest of the October 2024 peak near $2,790. Safe-haven demand due to geopolitical uncertainties and trade war fears, as well as expectations of Federal Reserve rate cuts, which lowers bond yields and makes gold more attractive, underpin the overall bullish outlook. Positive technical factors include strengthening oscillators and a strong support base above $2,700. This increases the chances of further upward movement. Even with the bullish momentum, downside risks are not to be ruled out. A modest recovery in the US Dollar and a generally positive tone in equity markets could limit gold’s gains. Any corrective pullback is expected to find strong support at $2,700, a key psychological level. A deeper drop may find support at $2,660-$2,635, the 100-day EMA and an important ascending trendline. A break below that area could spur additional declines toward $2,622-$2,618. Still, the macro and technical setup leaves little room for downside risks to be a dominant factor, so the overall trend is still on the side of bulls.

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Commodities Gold

Gold Price Rises on Fresh USD Selling: Market Analysis

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  • January 20, 2025
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Gold prices have started the week on a positive note, supported by renewed selling pressure on the US Dollar amid growing expectations of two Federal Reserve interest rate cuts this year. The yellow metal, considered a hedge against inflation and economic uncertainty, finds support around the $2,700 mark, with technical levels indicating potential resistance near $2,715 and $2,724-2,725. On the downside, any dips are likely to attract buyers, with significant support zones at $2,662 and $2,635. Although a strengthening geopolitical sentiment and strong equity market mood might put a lid on gains, the markets are on their toes before important events such as US President-elect Donald Trump’s inaugural speech that might shape inflation expectations and direction of Federal Reserve policy. KEY LOOKOUTS • Markets are expecting two rate cuts from the Federal Reserve this year that may soften the USD and cause gold prices to soar further as an asset that finds safe haven. • Gold is resisting at $2,715 and $2,725; it could rally to $2,745 if oscillators on the daily chart continue to stay bullish. • Strong support is seen between $2,662 and $2,635; any significant decline below these levels may attract a bearish trend, thus cautious investor attention. • Donald Trump’s economic policies and easing tensions in the Middle East are still important factors, which may impact both inflation expectations and safe-haven demand for gold. Prices for gold still seem buoyant, lifted by expectations that there would be two Federal Reserve rate cuts this year, which has weakened the US Dollar and bolstered safe-haven demand. From a technical perspective, the yellow metal faces resistances near $2,715 and $2,725, and it may climb towards $2,745 if bullish momentum continues. Key support levels are likely to attract dip-buyers at $2,662 and $2,635, capping a deeper decline. While geopolitical tensions ease and US President-elect Donald Trump’s proposed policies are likely to have a bearing on inflation and the Federal Reserve’s response, they remain essential in forming the gold market view. A softer US Dollar supports gold prices, with Federal Reserve rate cuts being anticipated. Strong support comes in at $2,662, and $2,715 remains the resistance point. • Speculation about Federal Reserve rate cuts has softened the USD, increasing the appeal of gold as a safe-haven asset. • Gold faces significant resistance at $2,715 and $2,724-2,725, with potential to reach $2,745 if bullish momentum continues. • Dip-buying activity is expected near $2,662 and $2,635, offering a safety net for gold’s price movement. • Daily chart oscillators are seen positive, which might pave the way for potential moves higher, either toward $2,760 or even higher. • Expectation of policies of Donald Trump and creeping inflationary pressures could definitely exert an influence on investors’ outlook in increasing demand for gold. • Easing tensions in the Middle East and a stable equity market are likely to cap the short term gains in gold. • Aiming to challenge its all-time high of $2,790, gold remains a focal point for investors seeking stability amid uncertain global events. Gold prices started the week on a modest note, supported by renewed selling in the US Dollar amid growing expectations of Federal Reserve rate cuts this year. The prospect of lower interest rates has weakened the greenback, making gold a more attractive safe-haven asset for investors. Technically, gold faces resistance near the $2,715 and $2,724 levels, while support zones at $2,662 and $2,635 continue to attract dip-buying activity. Positive momentum in daily chart oscillators suggests the potential for further gains, with the yellow metal eyeing the $2,745 intermediate hurdle and potentially moving towards its all-time high of $2,790. XAU/USD Daily Price Chart. Source: TradingView, Prepared By ELLYANA However, geopolitical and economic factors could influence gold’s trajectory. The easing of tensions in the Middle East and a generally positive tone in equity markets may cap gold’s upside, as investors show less interest in risk-averse assets. Meanwhile, anticipation of US President-elect Donald Trump’s policies and their potential impact on inflation and monetary policy add another layer of uncertainty to the market. These dynamics, allied with key technical levels, place gold’s performance high on the agendas of traders and investors in the coming weeks. TECHNICAL ANALYSIS From a technical analysis viewpoint, gold prices are approaching levels that could go a long way in deciding the near-term trend. The two zones of resistance at $2,715 and $2,724-$2,725 remain crucial. Should these break out, it’s likely to clear the way toward $2,745 and further toward the range of $2,760-$2,762. The daily chart oscillators are still accumulating positive momentum, sustaining the bullish sentiment. On the downside, there is immediate support between $2,700 and $2,690, but a stronger floor around $2,662-$2,635 aligns with a short-term ascending trendline and the 100-day EMA. If these levels fail to hold for an extended period, it would suggest a deeper pullback toward the $2,620-$2,615 confluence zone.  FORECAST Gold prices are poised for further gains as technical indicators maintain a bullish outlook. A sustained break above the $2,715 resistance level could open the door to test the $2,724-$2,725 region, a one-month high. Beyond this, the next upside targets lie at $2,745, with an eventual move toward the $2,760-$2,762 area if positive momentum persists. Strong demand from dip-buyers and even more favorable macroeconomic conditions, for example, if the Federal Reserve is expected to cut rates again, could power the rally higher. In the longer term, gold may well try to make a new high at $2,790 in case geopolitical tensions or inflationary concerns flare again. On the downside, major support lies around $2,700 and then $2,690, and a deeper cushion around $2,662-$2,635. A breakdown of these levels would likely lead to additional selling that would drive the price down toward $2,620-$2,615. Here, several technical factors including a short-term ascending trendline and the 100-day EMA offer good support. More significant corrections for gold could occur in the event of a shift in broader market sentiment or a strengthening US Dollar due to unexpected economic data or Federal Reserve commentary. However, heavy buying

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Commodities Gold

Gold Bulls Face Key Test at $2,708 Resistance as Inflation Data Boosts Rate Cut Speculation

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  • January 16, 2025
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Gold prices extended their recovery, rising above $2,700 and eyeing further gains, fueled by mixed US CPI data that increased expectations for a Federal Reserve rate cut by June. While headline CPI accelerated, core inflation rose more slowly than expected, boosting the probability of a 25 basis point rate reduction, with the CME FedWatch tool showing a 63.8% chance of lower rates after the June meeting. This drove gold’s ascent to a pivotal level of $2,708, with potential resistance at $2,721 and the all-time high of $2,790 looming ahead. The US 10-year Treasury yield remained in a downward trend, bolstering the positive sentiment for gold. But at $2,708, it is a test of technical significance that may result in a correction if the Relative Strength Index shows it is overheating. A close above $2,721 will put gold into a position for a run to its all-time high. Downside support rests at $2,671, $2,648, and $2,640. KEY LOOKOUTS • Even higher market expectations for a Fed rate cut by June may continue to drive gold prices higher as long as inflation moves lower. • Gold needs to clear some tough resistance at $2,708 and $2,721 to potentially drive prices toward the all-time high of $2,790 • Fast RSI moves could be an overheat sign, and gold prices might experience a short-term correction if momentum declines near major resistance zones. • The US Treasury yields have been trending lower, currently below 4.70%, and are likely to further propel gold upward since lower yields decrease the opportunity costs of holding bullion. The gold is near critical resistances at $2,708 and $2,721. If it breaks out above those levels, then it could continue pushing prices up toward the all-time high of $2,790. Additionally, growing market expectations for a Fed rate cut by June will continue to support the prices if inflation remains subdued. However, the sharp rise in the RSI indicates overheating and a short-term correction if momentum stalls. Moreover, the continued decline in US Treasury yields, which are currently below 4.70%, will further provide upside for gold as lower yields reduce opportunity costs for holding bullion. A rise in the hopes of a Fed rate cut by June supports the gold prices and resistance at $2,708 and $2,721. A breakout might target $2,790; however, overbought RSI and declining Treasury yields bring caution. • Growing market expectation for a 25 basis point rate cut by June supports gold’s upside. • US CPI: Core inflation grows at a slower rate, increasing the chances of Fed rate cut. • Critical resistance sits at $2,708 and $2,721; prices exceeding these levels is a possible threat for pushing up to its highs at $2,790 • An explosive rising RSI often spells overheating conditions that a near-term selling could be inevitable should the move get stuck up • Treasury yields falling well under 4.70% decrease opportunity costs, aiding the rise in gold; bearish thesis from this arena ruled out by technical • Buy-support levels arrive around $2,671,$ 2,648, $2,640. • The upcoming US economic data, such as retail sales and jobless claims, will be critical in determining the market sentiment and direction of gold prices. Gold prices are on the upswing due to increasing prospects of a rate cut by the Federal Reserve by June, following mixed US CPI data. Although the headline inflation has accelerated, core inflation increased at a slower pace, which has increased the chances of a 25 basis point rate cut. The market is now pricing in a 63.8% chance of lower rates after the June meeting, which has fueled demand for gold as a safe haven. Gold is facing key resistance at $2,708 and $2,721; breaking these levels could see it targeting the all-time high of $2,790. XAU/USD Daily Price Chart Sources: TradingView, prepared by ELLYANA Technical indicators are hinting at being cautious, but the Relative Strength Index (RSI) reflects rapid growth here, which would mean overheating and a good chance of seeing a short-term correction. On the downside, one finds support lines at $2,671, $2,648, and $2,640. Yet, falling US Treasury yields, at this point less than 4.70%, continue to give gold prices their boost since falling yields lower the opportunity cost for holding non-yielding assets, such as bullion. Upcoming US economic data in the form of retail sales and jobless claims, for example, could decide the course of gold to maintain its bullish or pull back. TECHNICAL ANALYSIS The firm currently remains in an uptrend with prices above $2,700 and is seen making its way toward significant resistance at $2,708. A crack of this level will push gold to $2,721 and all-time high of $2,790. However, the Relative Strength Index is increasing rapidly, showing more and more bullish momentum, but also at a risk of overheating and short-term correction. Key support levels are at $2,671 (trendline), $2,648 (55-day SMA), and $2,640 (100-day SMA). If gold fails to break through resistance, a pullback towards these support zones could occur, while strong breaks could extend the rally further.  FORECAST Gold is now bullish, with an excellent thrust above $2,700. If the price breaks above $2,708, then it should move into $2,721, which could hit $2,790 as the all-time high. Continued expectations for a June Fed rate cut and falling Treasury yields will push gold even higher. When gold clears $2,721, then it can open the route to a rally into $2,790 or higher. If gold runs into resistance and cannot break above $2,708, there is a good chance of a pullback, especially if the RSI is showing signs of overheating. In this case, key support levels are at $2,671 (trendline), $2,648 (55-day SMA), and $2,640 (100-day SMA). A failure to hold above these levels could send the price lower, potentially testing $2,640 or lower. The risk of a correction is higher if momentum slows or if unfavorable economic data impacts sentiment.

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