- The price of gold moves down while optimism for the commercial truce between the US and China undermines the demand for safe refuge.
- The impression of the US CPI on Tuesday reaffirms the betting bets of FED fees and keeps the USD’s bulls to the defensive.
- Geopolitical risks could limit deeper losses for the Xau/USD torque, justifying caution for bassists.
The price of gold (Xau/USD) struggles to capitalize on the modest increase of the previous day and attract new sellers during the Asian session on Wednesday. The last optimism about the de -escalation of a potentially harmful commercial war between the US and China – the two largest economies in the world – continues to support a generally positive tone in the variable income markets. This, in turn, undermines the demand for traditional shelter assets and keeps the metal precious well within the scope of the weekly minimum touched on Monday.
Meanwhile, the softest inflation data than the expected US of gold without performance. Therefore, it will be prudent to expect a strong continued sale and a convincing break below the 3,200 $ brand before positioning for new losses for the Xau/USD pair.
What moves the market today: the price of gold is still pressed by commercial optimism
- The president of the USA, Donald Trump, said Monday that he does not see that tariffs on Chinese imports return to 145% after the 90 -day pause. In an interview with Fox News earlier on Wednesday, Trump said that the relationship with China is excellent, which adds to commercial optimism and undermines the price of safe refuge gold during the Asian session.
- In the Geopolitical Front, Russia and Ukraine are scheduled for their first high -level face to face conversations since 2022 in Istanbul this week in the midst of a growing demand for Russia to accept a high 30 -day fire. On the part of the US, it is expected that Secretary of State Marco Rubio and the special envoys Steve Witkoff and Keith Kellogg attend negotiations.
- The Israeli army said that he intercepted a hypersonic ballistic missile shot by the Militia Houthi group aligned with Iran to Ben Gurion airport near Tel Aviv since Yemen on Tuesday night. This maintains the geopolitical risks at stake and could stop the operators of opening aggressive bearish bets around the Xau/Usd torque.
- The US Labor Statistics Office (BLS) reported that the general consumer price index (CPI) dropped to 2.3% year -on -year in April from 2.4% of the previous month. Meanwhile, the underlying IPC, which excludes volatile food and energy prices, agreed with consensus estimates and increased 2.8% in annual terms in April.
- The operators are still valuing the possibility that the Federal Reserve reduces the indebtedness costs at 56 basic points in 2025. This does not help the US dollar to attract significant buyers after the fall on Tuesday from a maximum of a month and should contribute to limit deepest losses for the yellow metal without yield.
- There are no relevant economic data that move the market scheduled for publication from the US on Wednesday, leaving the USD at the mercy of the scheduled speeches of Fed officials. Apart from this, the feeling of broader risk will play a key role in the generation of short -term trading opportunities around the raw material.
The price of gold could accelerate the fall once the Ema of 200 periods in H4 is decisively broken
From a technical perspective, the Xau/USD torque has shown some resistance near the exponential mobile (EMA) average of 200 periods, currently located near the 3,225 $ region, in the 4 -hour graph since the beginning of this week. Since the oscillators in the daily chart have begun to deviate to negative territory, a convincing break below the aforementioned support will be seen as a new trigger for the bearish operators. A subsequent fall below the round figure of $ 3,200 will confirm a new break and make the price of gold vulnerable to resume its recent corrective slip from the psychological brand of $ 3,500, or the historical peak reached in April. The raw material could then accelerate the fall towards the test of the following relevant support near the area of $ 3,135.
On the other hand, the maximum of the oscillation of the previous night, around the 3,265-3,266 $ region, now seems to act as an immediate obstacle, above which the price of gold could aspire to recover the $ 3,300 mark. Some continued purchases and a movement beyond the weekly maximum, around the area of 3,317-3.318 $, could change the bias in favor of the upward operators and raise the price of gold towards the obstacle of 3,345-3.347 $ en route to the static barrier of 3,360-3.365 $. A sustained fortress beyond the latter will establish the stage for a movement towards the round figure of 3,400 $.
FAQS risk feeling
In the world of financial jargon, the two terms “appetite for risk (Risk-on)” and “risk aversion (risk-off)” refers to the level of risk that investors are willing to support during the reference period. In a “Risk-on” market, investors are optimistic about the future and are more willing to buy risk assets. In a “Risk-Off” market, investors begin to “go to the safe” because they are concerned about the future and, therefore, buy less risky assets that are more certain of providing profitability, even if it is relatively modest.
Normally, during periods of “appetite for risk”, stock markets rise, and most raw materials – except gold – are also revalued, since they benefit from positive growth prospects. The currencies of countries that are large exporters of raw materials are strengthened due to the increase in demand, and cryptocurrencies rise. In a market of “risk aversion”, the bonds go up -especially the main bonds of the state -, the gold shines and the refuge currencies such as the Japanese yen, the Swiss Franco and the US dollar benefit.
The Australian dollar (Aud), the Canadian dollar (CAD), the New Zealand dollar (NZD) and the minor currencies, such as the ruble (Rub) and the South African Rand (Tsar), tend to rise in the markets in which there is “appetite for risk.” This is because the economies of these currencies depend largely on exports of raw materials for their growth, and these tend to rise in price during periods of “appetite for risk.” This is because investors foresee a greater demand for raw materials in the future due to the increase in economic activity.
The main currencies that tend to rise during the periods of “risk aversion” are the US dollar (USD), the Japanese yen (JPY) and the Swiss Franco (CHF). The dollar, because it is the world reserve currency and because in times of crisis investors buy American public debt, which is considered safe because it is unlikely that the world’s largest economy between in suspension of payments. The Yen, for the increase in the demand for Japanese state bonds, since a great proportion is in the hands of national investors who probably do not get rid of them, not even in a crisis. The Swiss Franco, because the strict Swiss bank legislation offers investors greater protection of capital.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
