- Since the beginning of the US inflation week, the gold price index has been on its strongest upward trajectory, with gains extending to the resistance level of $2922 per ounce.
- It is stable at the time of writing the analysis, as markets and investors await US inflation readings, starting with the announcement of the US Consumer Price Index today and then the Producer Price Index reading.
- This is in addition to monitoring the gold bullion markets’ reaction to Trump’s aggressive policies, which have changed all market and investor expectations.
Will Gold Prices Rise in the Coming Days?
According to gold market experts’ forecasts, current gold prices remain positively supported by the decline in the US dollar and the continued purchase of gold bullion as a safe haven. This is in light of the environment of growing concerns about the US economic outlook amid escalating trade tensions. In this regard, US President Donald Trump said in an interview with Fox News before the start of trading this week that the US economy is facing a “transition period,” while refusing to rule out the possibility that his trade policies could cause a recession. This comes after the United States postponed the imposition of 25% tariffs on several Canadian and Mexican goods for a month, while Canada maintained its initial retaliatory measures. China imposed new tariffs on select US agricultural products in response to Trump’s tariff increases.
On the monetary policy front, US Federal Reserve Chairman Jerome Powell acknowledged the rising economic uncertainty but indicated a lack of urgency in cutting US interest rates.
US Dollar Index Stable Around 2025 Low
According to forex market trading, the US Dollar Index (DXY), which measures the performance of the US currency against a basket of other major currencies, maintained its recent decline, holding steady around the 103.50 support level, the 2025 low. The US dollar’s losses deepened as fears grew that Trump’s trade policies and government reshuffles could push the US economy into recession.
Responding to fears of a US recession, US President Donald Trump refused to rule out a recession, describing the current economic phase as a “transition period.” Now, investors are closely monitoring upcoming US CPI and PPI data for fresh insights on inflation ahead of next week’s Federal Open Market Committee (FOMC) meeting, where the Federal Reserve will release updated economic forecasts.
According to currency market trading, the US dollar fell significantly against the Japanese yen and the Swiss franc, as increased risk aversion increased demand for safe-haven currencies. Meanwhile, the euro and pound sterling rose on expectations of increased defence spending in Europe.
Increased US Treasury Yields
According to recent trading and through licensed trading companies’ platforms, the 10-year US Treasury yield rose to 4.25% yesterday, as financial markets assessed the risks of persistent inflation amid growing concerns that destabilizing economic policies in the US could ultimately lead to contraction. Adding to the concerns was US President Trump’s announcement that the US will double tariffs on Canadian steel and aluminum to 50% starting tomorrow, and threatened a sharp increase in tariffs on cars if Canada does not cancel its retaliatory tariffs, raising fears that the US President will continue to impose surprise and protectionist economic policies despite their risks to the US economy.
According to trading, longer-term bonds refrained from continuing their upward trend during the month despite the decline in stocks and the rise in short-term debt. However, widening credit spreads reinforced the market’s preference for safer assets. Meanwhile, the JOLTS jobs index showed that US job openings rose more than expected in January, alleviating concerns about a weak labour market.
Trading Tips:
I still prefer to buy gold at every low level, but without risk and by monitoring the factors driving the gold market’s gains.
US Stocks Attempt to Stop Losses
During yesterday’s trading session and across stock trading platforms, US stock market indices witnessed fluctuations at the end of trading, following a relative calm in trade tensions between the United States and Canada. Based on performance, the S&P 500 index was trading near a stable level, recovering from previous losses of more than 1.5%, while the Dow Jones index fell 200 points, and the Nasdaq 100 index rebounded by 0.5%.
For his part, Trump stated that he is reconsidering plans to double tariffs on Canadian steel and aluminium to 50%, shortly after Ontario Premier Doug Ford and US Commerce Secretary Howard Lutnick announced a meeting in Washington on Thursday and the suspension of additional electricity export duties for the province. According to trading, airline stocks declined, with Delta shares falling 5% after lowering its earnings forecast due to weak US demand. Other travel stocks followed suit, with Disney shares falling about 5% and Airbnb shares falling 4%. Investors now look ahead to Wednesday’s US Consumer Price Index report for further insights into market trends.
Gold Price Technical Analysis and Expectations Today:
According to daily chart trading and gold analysts’ forecasts today, the general trend for gold prices will remain upward. As we mentioned before, stability around and above the $2900 per ounce resistance will support new technical buy trades, and gold bulls’ eyes are strongly focused on the next historical psychological resistance of $3000 per ounce, and this will happen if prices first move towards the resistance levels of $2955 and $2978, respectively. Ultimately, gold investors will not pay attention to technical indicators moving towards strong overbought levels as much as they pay attention to the factors of the gold price index gains.
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