- The price of gold is stabilized after falling on Tuesday, since the US President Trump signed an executive order to reduce tariffs on cars.
- Operators prepare for key economic data from the US, with the US GDP on the agenda, since it could indicate the impact of tariff policy.
- Technically, both resistance and daily gold supports are narrowing, pointing out the growing possibilities of a break.
The price of gold (Xau/USD) continues to quote around 3,300 $ on Wednesday, while operators expect key economic data from the United States, which could become the catalyst for an imminent rupture. The Lingote faces a second day of taking a profit after the US president Donald Trump signed an executive order to reduce tariffs on car parts, since the president highlighted progress in commercial negotiations, Bloomberg reported. With more signs that commercial tensions are decreasing, the recovery of gold seems to be fading.
In the economic calendar, all eyes focus on the preliminary reading of the US gross domestic product (GDP) for the first quarter. This is one of the key data points that the Federal Reserve could consider when deciding what to do on May 7 with respect to interest rates. That same Fed and its president, Jerome Powell, were again criticized by Trump during the night, who said he knows much more about the interest rates than Powell and that he is not doing a good job, Bloomberg reported.
What moves the market today: change to high level of US
- Investors, restless for the growing global commercial war, went to fund Reuters
- Jewelry sales in India fell in March compared to the same month last year, and it is expected to decrease up to 11% during the fiscal year that ends in March 2026, Bloomberg reports.
- At 12:30 GMT, the preliminary reading of the first trimester of the Gross Domestic Product (GDP) of the United States will be published. Economists expect the US economy to have grown at a modest annualized rhythm of 0.4%, much slower than the 2.4% expansion observed in the fourth quarter of 2024.
- The monthly data of the PCE of March will also be published. The monthly underlying PCE is expected to be 0.1%, below 0.4%. The monthly general number is expected to fall to 0%, from the previous 0.3%.
Technical analysis of the price of gold: imminent rupture
With the reduction of tariff pressure after the decrease of some automotive tariffs by Trump, the probabilities of a downward break in the ingot seem likely. However, US data could play a crucial role here, for example, in case the US GDP numbers show a contraction. If Trump changes his mind again and emits more surprising tariffs, for example, an increase in gold would be inevitable.
The daily pivot point at $ 3,322 is the first level that needs to be recovered up. From there, the next level to be taken into account is $ 3,344, resistance R1. The R2 resistance at $ 3,370 is for now the rise guard to try to reject the price of gold and re -enter over $ 3,400.
In the lower part, the S1 support provides a mattress at $ 3,295. Below, the pivotal technical floor about $ 3,245 (maximum of April 11) comes into play.
Xau/USD: Daily graphic
FAQS GOLD
Gold has played a fundamental role in the history of mankind, since it has been widely used as a deposit of value and a half of exchange. At present, apart from its brightness and use for jewelry, precious metal is considered an active refuge, which means that it is considered a good investment in turbulent times. Gold is also considered a coverage against inflation and depreciation of currencies, since it does not depend on any specific issuer or government.
Central banks are the greatest gold holders. In their objective of supporting their currencies in turbulent times, central banks tend to diversify their reserves and buy gold to improve the perception of strength of the economy and currency. High gold reserves can be a source of trust for the solvency of a country. Central banks added 1,136 tons of gold worth 70,000 million to their reservations in 2022, according to data from the World Gold Council. It is the largest annual purchase since there are records. The central banks of emerging economies such as China, India and Türkiye are rapidly increasing their gold reserves.
Gold has a reverse correlation with the US dollar and US Treasury bonds, which are the main reserve and shelter assets. When the dollar depreciates, the price of gold tends to rise, which allows investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rebound in the stock market tends to weaken the price of gold, while mass sales in higher risk markets tend to favor precious metal.
The price of gold can move due to a wide range of factors. Geopolitical instability or fear of a deep recession can cause the price of gold to rise rapidly due to its condition of active refuge. As an asset without yield, the price of gold tends to rise when interest rates lower, while the money increases to the yellow metal. Even so, most movements depend on how the US dollar (USD) behaves, since the asset is quoted in dollars (Xau/USD). A strong dollar tends to keep the price of gold controlled, while a weakest dollar probably thrusts gold prices.
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.
