- The gold price remains strongly bullish with a minor correction.
- Trump tariffs raise the demand for gold as investors flee to safe-haven.
- Traders now eye US ISM Services PMI and US NFP data for further clarity.
The gold price posted fresh all-time highs on Thursday as investors fled to safe-haven assets following US President Trump’s escalated trade tariffs. The recent move imposed a 10% baseline tariff on all imports and more on major trading partners, fueling global trade tension and uncertainty in the markets.
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Spot gold touched all-time highs at $3,167 before shedding gains and settling in the $3,130 area. Despite the corrective downside, the precious metal retains its upward trajectory and has gained 19% year-to-date.
The recent round of tariffs could slow down US economic growth, raising the likelihood of the Fed cuts in the near future. According to Kyle Rodda, an analyst at Capital.com, “One of the key factors pushing gold higher is the potential slowdown in the economy that could raise odds of aggressive rate cuts.”
Moreover, the City Index analyst Mat Simpson said that the bullish momentum will continue until markets see a significant shakeout that stuns both bulls and bears.
Traders now anticipate that after aggressive trade policies, the central banks will move away from the US dollar-denominated assets towards holding more gold. Moreover, the Federal Reserve is expected to ease monetary policy to cushion the economy impacted by trade policies. Hence, the greenback can further drift lower, giving a further boost to the yellow metal.
Economic Data and Upcoming Events
The US labor market shows resilience with private payrolls rose to 155k in March against the expected 105k. However, the economists caution that signs of labor market cooling are emerging, especially as businesses brace for a slower growth in the coming months.
Investors are now preparing for the upcoming US ISM Services PMI and US NFP. The reports will provide further insight to the US economy and influence the Fed’s policy outlook.
Gold price technical analysis: Pullback after a strong rally
The gold price erased some of earlier session gains, falling back to $3,130 area from the fresh all-time highs. The price is near the orderblock zone which acts as a strong support. The price is well bid above the 30-period SMA despite a pullback.
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The RSI value has dropped from the overbought zone to 56.0 level, which suggests the buyers can emerge again anytime as the major trend has not yet changed. The metal can test $3,100 level is further profit-taking is seen.
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