- The price of gold fails to capitalize on the modest profits of the previous day in mixed signals.
- A modest rebound of the USD weighs on the raw material, although the fall remains limited.
- Fed rate cuts bets, US fiscal concerns, geopolitical risks and commercial uncertainties could support Xau/USD.
The price of gold (Xau/USD) attracts new vendors in the vicinity of the region of 3,385 $, or a maximum of several weeks reached on Tuesday, and erodes part of the modest profits of the previous day. The fall is sponsored by a slight recovery of the US dollar (USD), which tends to undermine the demand for raw material. However, a combination of factors could continue to act as a favorable wind for precious metal before possible conversations between US president, Donald Trump, and Chinese President Xi Jinping.
Investors remain on alert to the persistent geopolitical risks, the uncertainties related to trade and the US tax concerns, which, in turn, should support the price of gold refuge gold. In addition, bets that the Federal Reserve (FED) will further reduce indebtedness costs in 2025 could limit a significant appreciation of the USD and contribute to limit losses of the yellow metal without performance. This, in turn, justifies a certain caution for the bearish operators and before positioning themselves for any new fall.
What moves the market today: the price of gold is pressed for the appearance of some purchases of USD
- Automatic Data Processing (ADP) on Wednesday that US private sector employers added only 37K jobs in May, below consensus estimates and marking the lowest level since March 2023. In addition, April’s reading was reviewed at 60k from the 62K originally reported.
- In addition, a survey of the Supply Management Institute (ISM) showed that business activity in the US services sector contracted unexpectedly in May for the first time since June 2024. In fact, the PMI of services of the US ISM services fell to 49.9 last month since 51.6 in April.
- The yields of the American treasure bonds two years and the 10 -year reference performance fell to the lowest level since May 9 amid the bets that the Federal Reserve will cut interest rates in September. In addition, the US president Donald Trump pressed the president of the FED, Jerome Powell, to reduce the fees.
- The moderate expectations of the Fed, together with the concerns that the US budget deficit could worsen at a faster rate than expected due to Trump’s tax and flagship tax bill, do not help the US dollar to attract buyers. This provides some support for the price of gold without performance.
- The increase in the import tariffs of steel and aluminum from 25% to 50% entered into force on Wednesday. This occurs before the high -risk call between Trump and Chinese President Xi Jinping and amid renewed fears of a commercial war between the two largest economies in the world.
- Trump said he had spoken again with the Russian president, Vladimir Putin, and that the Kremlin leader promised to retaliate against the Ukrainian attack on Russian bombers. Trump added that a high fire in Ukraine was still distant, which keeps the geopolitical risk premium at stake.
- The US vetoed a resolution of the United Nations Security Council that requested a high immediate, unconditional and permanent fire in Gaza for the fifth time. Meanwhile, Israeli attacks in Gaza have killed almost 100 Palestinians in the last 24 hours in the midst of a humanitarian aid block.
- The operators now expect the publication of the weekly data of initial unemployment applications of the USA.
Gold price bundles need to wait a movement beyond the obstacle of $ 3,385 before making new bets
From a technical perspective, the break this week above the barrier of 3,324-3.326 $ was seen as a key trigger for the bullies. In addition, oscillators in daily/hour graphics remain comfortably in positive territory and suggest that the road of lower resistance for the price of gold is still upwards. However, it will be prudent to wait for some purchase of continuation above the 3,385 $ region, or a maximum of several weeks reached on Tuesday, before positioning for new profits. He Xau/usd It could then exceed the 3,400 $ brand and climb more towards the region of 3,433-3.435 $. The impulse could extend even more to the neighborhood of $ 3,500 or the historical peak established in April.
On the other hand, the 3,355 $ area could offer immediate support to the price of gold. Any additional fall could continue to attract some buyers in the fall and it is more likely to remain limited near the mentioned resistance break point, around the area of ​​3,326-3.324 $. However, some continuation sales could make the raw material vulnerable to weakening even more below the $ 3,300 mark and test the horizontal support of 3,286-3.285 $.
Commercial War between the US and China Faqs
In general terms, “Trade War” is a commercial war, an economic conflict between two or more countries due to the extreme protectionism of one of the parties. It implies the creation of commercial barriers, such as tariffs, which are in counterbarreras, increasing import costs and, therefore, the cost of life.
An economic conflict between the United States (USA) and China began in early 2018, when President Donald Trump established commercial barriers against China, claiming unfair commercial practices and theft of intellectual property by the Asian giant. China took retaliation measures, imposing tariffs on multiple American products, such as cars and soybeans. The tensions climbed until the two countries signed the Phase one trade agreement between the US and China in January 2020. The agreement required structural reforms and other changes in China’s economic and commercial regime and intended to restore stability and confidence between the two nations. Coronavirus pandemia diverted the attention of the conflict. However, it is worth mentioning that President Joe Biden, who took office after Trump, kept the tariffs and even added some additional encumbrances.
Donald Trump’s return to the White House as the 47th US president has unleashed a new wave of tensions between the two countries. During the 2024 election campaign, Trump promised to impose 60% tariff particularly in investment, and directly feeding the inflation of the consumer price index.
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.
