On Tuesday, the price of gold climbed to 3,220 USD per troy ounce as market uncertainty surrounding US President Donald Trump’s tariff policies continued to support demand for safe-haven assets.
Key factors driving gold’s movement
The precious metal’s stability is closely tied to lingering uncertainty over Trump’s tariffs. After temporarily exempting technology products from reciprocal duties, his administration is now considering similar exemptions for auto parts.
However, the White House heightened tensions on Monday by launching a national security probe into pharmaceutical and semiconductor imports – a move that could pave the way for additional tariffs.
Further supporting gold prices were comments from Christopher Waller, a member of the Federal Reserve Board of Governors, who suggested that interest rates could be cut soon if Trump’s sweeping tariffs remain in place.
Markets are currently pricing in an 86-basis-point rate cut by the end of the year, though most investors expect the Fed to hold rates steady in May.
Technical analysis: XAU/USD
H4 Chart Overview
- The market saw an upward wave, peaking at 3,245, followed by a correction to 3,194
- Today, consolidation is expected around 3,220. A downside breakout could trigger a further correction towards 3,175, after which a rebound towards 3,253 may follow
- Conversely, an upside breakout may extend the rally to 3,253, the primary target of this growth wave
- A subsequent decline towards 3,105 is anticipated
- The MACD indicator supports this outlook, with its signal line at extreme highs and poised for a pullback towards zero
H1 Chart Overview
- The market completed a third-wave advance to 3,245, with consolidation now likely beneath this level
- A downside exit may initiate a correction towards 3,175, while an upside exit could extend gains to 3,253, where the uptrend may exhaust itself
- Beyond this, a deeper corrective decline towards 3,105 is possible
- The Stochastic oscillator aligns with this view, with its signal line above 80 and showing signs of an impending reversal
Conclusion
Gold remains buoyed by geopolitical and monetary policy uncertainty, with technical indicators suggesting near-term consolidation before potential further upside, followed by a corrective pullback.
