- The price of gold in euros reaches a maximum of a month by € 2,929.
- The lack of news about negotiations between the EU and the United States weighs on the euro.
- The tendency for the Xau/EUR points to the rise, although the RSI is highly overwhelmed in the 4 -hour graph, pointing a possible correction in the next few hours.
The ounce of gold in euros records profits for seventh consecutive day, raising this Wednesday to € 2,929, its highest price since June 23. At the time of writing, the Xau/EUR quote about 2,923.24, winning 0.17% in the day.
The lack of agreement between the EU and the USA
After the announcement according to the early hours of Wednesday between the United States and Japan, the Market concerns are transferred to the European Union, since the deadline of August 1 imposed by Donald Trump is approaching to apply 30% tariffs if a pact is not reached. The lack of news about the progress of negotiations weighs on the euro and drives gold in recent days. The latest media information suggests that the EU could activate its anticoration instrument, being able to apply taxes and limitations on large US companies and the investments and products from the United States.
On the other hand, tensions in the Middle East continue, supporting the purchase of gold as a safe refuge asset. The Lack of food among the Palestinian population has reached a critical levelor, with dozens of humanitarian organizations, including the UN, denouncing the blockade of Israel and the imminent death of hunger that can affect the population and health personnel.
Later in the day, the focus will be in the preliminary data of Eurozone consumer trust For the month of July, waiting for -15 points from the previous -15.3. A better fact than expected could boost the euro, while a disappointing one could make him lose more land.
Gold price levels
The Trend at the Xau/EUR points in the short, medium and long term risealthough the 14 -day relative force (RSI) index is overcapted in the 4 -hour graph, suggesting a correction within the upward trend later in the day.
Upwards, an overcoming of the maximum of four weeks reached today at € 2,929 could trigger a movement in the direction of € 2,995, June ceiling. Above the € 3,000 barrier, the next resistance would be at the historical maximum of € 3,035 reached on April 22.
Down, a break is necessary below the € 2,900 area for the Xau/EUR to fall towards the support located at € 2,892, a mobile average of 100 periods in one -hour graph. Below, the descent can stop around € 2,855, where the floor of last week is.
GOLD – FREQUENT QUESTIONS
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.
