- The price of gold brings a Asian session slide to the lowest three -week level, but does not follow.
- The fears of stagnation continue to be weighed on the feeling of investor and to benefit the safely lying commodity.
- For more aggressive Fed ratio deductions, bets weaken USD and also support the XAU/USD pair.
Gold price (XAU/USD), during the Asian session on Monday about $ 2,972-2.971 $, about $ 2,972-2.971 $ a good intraday jump and the last hour of $ 3.055 $ rises to a daily height. Today, the previously released data showed that the Chinese Halk Bank (PBOC) increased the state gold reserves for the fifth month in a row. In addition, a widespread risky mood, stagnation fears, tariffs -oriented US economic slowdown in the Federal Reserve (FED) can soon force the ratio -cut cycle and geopolitical risks serve as a tail wind for meta.
However, investors rise quite quickly as they continue to loosen XAU/USD bull positions to meet the losses obtained from a wider sales in global financial markets. Meanwhile, the US Dollar (NFP) report and the FED President Jerome Powell’s hawk words, which are stronger than expected on Friday, helped keep the US Dollar (USD) comfortably on a very low -month touch last week. This turns out to be another factor that limits gains for gold price. However, Dovish -fed expectations kept USD Bulls in defense and helped keep the price of gold over $ 3,000.
Daily Digest Market Carriers: Gold Price receives support from a combination of factors; Bulls seem reluctant to put aggressive bets
- The expanding global trade war continues to increase concerns about a global economic stagnation and leads to an extended sales in self -equity markets worldwide. This asked the traders to liquidate their long positions around the gold price and to increase cash to meet the losses elsewhere.
- According to data released on this Monday, the Chinese Halk Bank (PBOC) added gold to its reserves for the fifth month in a row in March. In fact, the Chinese Halk Bank increased by 0.09 million Troy ounce last month between global trade and geopolitical turmoil last month.
- US President Donald Trump introduced at least 10% mutual tariffs to all imported goods late on Wednesday, and China faced 54% tax under this new regime. On the other hand, the Chinese Commercial Ministry announced on Friday that they will receive 34% additional tariffs in all US imports.
- Meanwhile, US Trade Secretary Howard Lotnick confirmed that tariffs will not be postponed on Sunday and that policy would remain in place for days and weeks. In addition, Trump said there would be no agreement with China unless the trade deficit is resolved.
- The US Dollar is struggling to benefit from the modest recovery movement on Friday, which followed the launch of the US Farm Equipment Payroll (NFP) report better than expected. In fact, closely monitored job data showed that the economy added 228 thousand jobs in March and had the previous 117k.
- Meanwhile, Federal Reserve (FED) President Jerome Powell said that inflation is closer to the target, but still rising a little. Powell added that Trump’s tariffs may have a strong inflationary effect, and the temporary price increases of Fed’s work is to avoid becoming permanent inflation.
- However, investors are still pricing in June of the US Federal Reserve in June, as well as reduce borrowing costs at least four times this year. With anti -risk miscarriage, the yield keeps the yield in the 10 -year US government bond below 4.0%.
- This prevents the USD bulls from placing aggressive bets and helps the yellow metals given to jump a modest intraday from a four -week low touch during the Asian session on Monday. However, the lack of follow -up is careful for bulls.
The price of gold should exceed $ 3,055 horizontal support for additional earnings.
From a technical point of view, the sharp retreat shift of last week from the highest stalls of the last week rose before the Fibonacci withdrawal level of 61.8% of the February-April powerful movement. However, the next movement approached a horizontal support point $ 3,055, and now has returned to resistance. Secondly, it should now act as a significant important point for Intrader traders, where the price of gold can climb to $ 3,080 in a 3,100 dollar tour.
On the Flip side, the $ 3,000 psychological sign, which corresponds to the 50% withdrawal level, now seems to be protecting a disadvantage before the $ 2,972-2.971 area or before a very weekly low touch in the early hours this Monday. This is followed by an area of $ 2,946, followed by a simple moving average (SMA) about 50 days, if broken, it can certainly change the short -term prejudice in favor of the bear traders and cause further depreciation.
Golden FAQ
Since gold is widely used as a means of value and change, it has played an important role in human history. Currently, in addition to its brightness and jewelry, precious metal is widely seen as a safe asset, that is, it is considered a good investment in turbulent times. Gold is also seen as a fence against currencies against inflation and depreciation because it is not based on a particular exporter or government.
Central banks are the largest gold holders. In order to support currencies in turbulent times, central banks tend to diversify and purchase gold to increase the perceived power of the economy and currency. High gold reserves can be a source of trust for a country’s payment power. According to World Gold Council data, central banks added 1,136 tons of gold worth about 70 billion dollars to their reserves in 2022. This is the highest annual purchase since the registrations started. Central banks of developing economies such as China, India and Türkiye are rapidly increasing their gold reserves.
Gold has an inverse correlation with both large reserves and safe assets, US Dollar and US treasures. The dollar tends to rise in the depreciation and allows investors and central banks to diversify their presence in turbulent times. Gold is also contrary to risk assets. While a rally on the stock market tends to weaken the gold price, sales in the risk markets tend to support valuable metal.
The price can act due to a wide range of factors. Geopolitical instability or a deep fear of stagnation can rapidly increase the price of gold due to safe protected status. As an inefficient asset, gold tends to rise with lower interest rates, while the higher cost of money usually gives weight on the yellow metal. Nevertheless, most moves depend on how the US dollar (USD) behaves as priced as dollar (XAU/USD). A strong dollar tends to control the gold price, while a weaker dollar raises gold prices.
