Gold prices XAUUSD held above $2,880 after falling nearly 1% on Monday. US President Donald Trump said over the weekend that the US economy could get worse before it gets better and that he was adjusting trade policy through tariffs, fueling market concerns about a possible economic recession.
As the broader financial markets fall sharply, investors may sell gold to cover losses in other assets, causing gold prices to fall in the short term.
So far this year, gold prices have risen 10% and hit a new high. The rally has been fueled by uncertainty surrounding the Trump administration’s policies, central bank gold buying and expectations that the Federal Reserve could cut interest rates further. Lower borrowing costs typically benefit non-yielding assets like gold.
While rising gold prices have dented physical demand in some major Asian economies, inflows into gold ETFs have remained steady. Holdings of gold ETFs hit their highest since December 2023 as of last week, according to data compiled by Bloomberg.
Investors had begun to reduce their exposure to gold ahead of Monday’s sharp market sell-off. Hedge funds’ long gold positions fell to their lowest in nine weeks, according to the latest data from the U.S. Commodity Futures Trading Commission (CFTC).
While this correction appears to be broad-based, the underlying forces will still be a solid support for gold's upside potential, from the geopolitical landscape to Trump's policies creating global trade conflicts to expectations of Fed rate cuts. Overall, gold still has a lot of support. Markets focus on US inflation data and Fed policy expectations
Investors are now focused on upcoming US inflation data to gauge whether the Federal Reserve will cut interest rates further:
US consumer price index (CPI) – due on Wednesday
US producer price index (PPI) – due on Thursday
Traders are now fully pricing in the possibility of a rate cut by the Federal Reserve in June. Federal Reserve Chairman Jerome Powell said on Friday that it remains to be seen whether the Trump administration’s tariff policies will lead to higher inflation.
In general, falling interest rates increase the appeal of gold because it is a non-interest-bearing asset, making it cheaper to hold than other assets.
Gold Price Technical Outlook Analysis
XAUUSD
On the daily chart, after gold fell to the support level noted by readers in the previous issue at 2,880 USD, it received support to recover, currently trading around 2,900 USD.
A break above the 2,900 USD price level would be considered a positive signal with the next target being the EMA21 area, followed by 2,929 USD rather than 2,942 USD.
In the short term, gold has not yet shown a specific trend as it enters the accumulation phase, which is depicted by the 2 green trend lines. But in the medium and long term, the possibility of price increase is still very good when in terms of momentum, the Relative Strength Index RSI remains above 50.
During the day, gold is in the accumulation phase with the main trend leaning towards price increase, the notable positions will be listed as follows.
Support: 2,880 – 2,868USD
Resistance: 2,900 – 2,929 – 2,942USD
As the broader financial markets fall sharply, investors may sell gold to cover losses in other assets, causing gold prices to fall in the short term.
So far this year, gold prices have risen 10% and hit a new high. The rally has been fueled by uncertainty surrounding the Trump administration’s policies, central bank gold buying and expectations that the Federal Reserve could cut interest rates further. Lower borrowing costs typically benefit non-yielding assets like gold.
While rising gold prices have dented physical demand in some major Asian economies, inflows into gold ETFs have remained steady. Holdings of gold ETFs hit their highest since December 2023 as of last week, according to data compiled by Bloomberg.
Investors had begun to reduce their exposure to gold ahead of Monday’s sharp market sell-off. Hedge funds’ long gold positions fell to their lowest in nine weeks, according to the latest data from the U.S. Commodity Futures Trading Commission (CFTC).
While this correction appears to be broad-based, the underlying forces will still be a solid support for gold's upside potential, from the geopolitical landscape to Trump's policies creating global trade conflicts to expectations of Fed rate cuts. Overall, gold still has a lot of support. Markets focus on US inflation data and Fed policy expectations
Investors are now focused on upcoming US inflation data to gauge whether the Federal Reserve will cut interest rates further:
US consumer price index (CPI) – due on Wednesday
US producer price index (PPI) – due on Thursday
Traders are now fully pricing in the possibility of a rate cut by the Federal Reserve in June. Federal Reserve Chairman Jerome Powell said on Friday that it remains to be seen whether the Trump administration’s tariff policies will lead to higher inflation.
In general, falling interest rates increase the appeal of gold because it is a non-interest-bearing asset, making it cheaper to hold than other assets.
Gold Price Technical Outlook Analysis
XAUUSD
On the daily chart, after gold fell to the support level noted by readers in the previous issue at 2,880 USD, it received support to recover, currently trading around 2,900 USD.
A break above the 2,900 USD price level would be considered a positive signal with the next target being the EMA21 area, followed by 2,929 USD rather than 2,942 USD.
In the short term, gold has not yet shown a specific trend as it enters the accumulation phase, which is depicted by the 2 green trend lines. But in the medium and long term, the possibility of price increase is still very good when in terms of momentum, the Relative Strength Index RSI remains above 50.
During the day, gold is in the accumulation phase with the main trend leaning towards price increase, the notable positions will be listed as follows.
Support: 2,880 – 2,868USD
Resistance: 2,900 – 2,929 – 2,942USD
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🪙 JOIN OUR FREE TELEGRAM GROUP 🪙
t.me/tradingchampionschannelJoin the community group to get support and share knowledge!
️🥇 Exchange and learn market knowledge
️🥇 Support free trading signals
️🥇 Zalo Group: zalo.me/g/hydlwv957
t.me/tradingchampionschannelJoin the community group to get support and share knowledge!
️🥇 Exchange and learn market knowledge
️🥇 Support free trading signals
️🥇 Zalo Group: zalo.me/g/hydlwv957
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.