Gold prices (XAU/USD) have surged to a fresh all-time high during the early European session on Thursday, marking a clear breakout from a short-term trading range. The catalyst for this rise is a combination of heightened global trade tensions, US President Donald Trump’s latest tariff threats, and a decline in US Treasury bond yields, all of which have fueled a strong demand for the safe-haven metal.
Key Drivers of the Gold Price Surge
Trade Tensions: President Trump has escalated trade tensions, announcing plans to impose heavy tariffs on various products, which has dampened investor appetite for riskier assets. His comments have intensified fears of a global trade war, prompting a flight to safety in gold.
US Dollar Weakness: The global uncertainty surrounding trade issues has pushed down US Treasury bond yields, which in turn has weakened the US Dollar. A weaker USD benefits gold as it becomes cheaper for holders of other currencies.
FOMC Minutes Impact: The minutes from the January Federal Open Market Committee (FOMC) meeting, released on Wednesday, reinforced expectations of an extended pause on US interest rate hikes. Although this might eventually lend support to the US dollar and bond yields, the immediate effect has been to keep gold prices elevated due to lower opportunity costs for holding non-yielding assets like gold.
Technical Indicators: Gold’s daily Relative Strength Index (RSI) remains above 70, suggesting overbought conditions. This raises caution for bullish traders, as the market might experience some short-term consolidation. However, the overall trend remains bullish, and any pullbacks are likely to be seen as buying opportunities.
Gold Price Outlook
Bullish Sentiment: The near-term bias remains tilted in favor of gold bulls. If prices sustain strength beyond the $2,945-$2,950 range, it will confirm a breakout and set the stage for a continuation of the upward trend seen over the past two months.
Support and Resistance Levels
Immediate Support: Any pullback below $2,928 would find support around the $2,918 region, and a more significant drop could target the $2,900 mark.
Resistance: The next upside target is the $2,945-$2,950 range, where gold could break out further.
Upcoming Economic Data to Watch
Weekly Jobless Claims and Philly Fed Manufacturing Index: These US economic reports, due for release on Thursday, may provide fresh insights into the US economy and further impact the USD and gold prices.
Global PMIs on Friday: These data points will give a clearer picture of the global economic outlook, which may drive further demand for gold as a safe-haven asset.
Overall, the combination of trade uncertainty, weak US dollar, and dovish Federal Reserve stance continues to support gold’s upward momentum. However, traders should remain cautious of overbought conditions and monitor key support levels for potential buying opportunities.
Related topics：
