Gold prices are on the rise as investors seek safety amid ongoing trade uncertainties and shifting US policies. With global markets facing volatility, concerns over tariffs, economic stability, and Federal Reserve decisions are driving demand for the precious metal. As the dollar struggles and trade tensions persist, gold remains a key asset for those looking to hedge against market instability.
Gold prices climbed above USD 2,920 per ounce on Thursday, nearing record levels, as a weaker US dollar and ongoing trade uncertainties fuelled demand for the safe-haven asset.
Market sentiment remained cautious following recent policy adjustments from President Donald Trump, which added to investor concerns and kept gold well-supported.
Trump introduced a temporary one-month exemption for US automakers from the newly implemented 25% tariffs on Canadian and Mexican imports, providing short-term relief to the sector.
Additionally, officials suggested that the 10% tariff on Canadian energy imports could be lifted if specific trade agreement conditions are met.
Despite these developments, broader uncertainties persist, with the US, Canada, Mexico, and China remaining embroiled in tariff disputes.
In response to these trade tensions, China has submitted a revised consultation request to the World Trade Organisation (WTO), challenging the latest US tariffs.
Retaliatory actions from affected nations have intensified economic concerns, further enhancing gold’s appeal as a hedge against market instability.
The US dollar struggled to gain momentum, offering additional support to gold prices. Investors are now turning their attention to the upcoming US non-farm payrolls (NFP) report, which could influence expectations regarding the Federal Reserve’s future policy decisions.
Employment growth in the private sector has slowed to its lowest level in seven months, increasing speculation that the Federal Reserve may consider further rate cuts to bolster economic activity.
However, an unexpected rebound in the US services sector indicates some resilience, complicating the Fed’s decision-making process.
Gold (XAU/USD) is currently trading at USD 2,924.17, up 0.21% for the session. The price briefly dropped to USD 2,894.40 before rebounding strongly toward USD 2,929.94, which now serves as the nearest resistance level.
Moving averages (5, 10, 30) indicate a consolidation phase, with price action stabilising around key levels. The MACD is shifting into positive territory, suggesting that bullish momentum is gradually strengthening.
A breakout above USD 2,930 could pave the way for a test of the USD 2,940 – USD 2,950 range, where sellers may re-enter the market.
On the downside, strong support is established at USD 2,894, and a decline below this level could push prices towards USD 2,880.
If economic uncertainty persists and the US dollar remains under pressure, gold may continue its upward trajectory, potentially reaching new highs.
However, any signs of easing trade tensions or stronger-than-expected US economic data could limit further gains.
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