Gold (XAU/USD) experienced a minor retreat of 0.09% on Thursday after hitting a record high. Despite this, its bullish trajectory remains solid, supported by expectations of U.S. interest rate cuts and ongoing global economic and political uncertainties. Analysts suggest that the recent decline was likely a technical correction following a strong rally that lost momentum near the significant $3,050 resistance level.
Alex Ebkarian from Allegiance Gold explained that gold’s role as a safe-haven asset has not been fully realized by retail investors, as the economy is not yet officially in recession. However, the ongoing economic slowdown may lead to more uncertainty and boost demand for gold.
Federal Reserve Chair Jerome Powell highlighted that President Trump’s policies, including tariffs, have likely slowed U.S. economic growth and pushed inflation higher. Even though inflation remains above the Fed’s target, expectations are that the central bank will cut rates twice by the end of the year. Analysts at Citi even predict that gold could reach $3,500 by year-end, underpinned by increased demand due to fears of U.S. economic issues such as stagflation.
Euro (EUR) Struggles Against U.S. Dollar
The euro (EUR) weakened by 0.46% against the U.S. dollar (USD) on Thursday as the U.S. Dollar Index (DXY) continued its rebound from recent lows. The euro has been on a downward trajectory since hitting a five-month high on March 18, with strong resistance at 1.09500 and a weak eurozone economic outlook prompting traders to take profits.
Adding to the pressure on EUR/USD are upcoming U.S. tariffs, scheduled to take effect on April 2. Market uncertainty surrounding these tariffs has led to recommendations from firms like Morgan Stanley to close long positions in EUR/USD and GBP/USD. Furthermore, reports from Expansión suggest that the European Central Bank (ECB) is unlikely to raise rates until at least 2026, reinforcing the dovish monetary stance that weighs on the euro.
Bitcoin (BTC) Faces Bearish Sentiment
Bitcoin (BTC) saw a significant drop of 3.1% on Thursday, coinciding with the Federal Reserve’s comments about delaying interest rate cuts due to uncertainties over U.S. tariffs. While U.S. President Trump has signaled a more crypto-friendly stance by proposing regulatory frameworks for stablecoins and advancing legislation for Bitcoin acquisitions, market reactions have been subdued.
Many market participants, including CryptoQuant’s CEO Ki Young Ju, now believe that Bitcoin has entered a bear market after a prolonged bullish cycle. This shift in sentiment is reflected in Bitcoin’s recent drop below its 200-day moving average, which has many traders seeking selling opportunities.
Conclusion
Gold, the euro, and Bitcoin are all navigating a complex landscape of economic data, geopolitical uncertainties, and shifting investor sentiments. Gold’s bullish trend is supported by expectations of rate cuts and global instability, while the euro faces headwinds from both U.S. tariffs and ECB policies. Bitcoin, despite recent regulatory developments, seems to be heading into a bearish phase, with market sentiment cooling and technical indicators signaling a downtrend.
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