Gold Price Forecast: XAU/USD Hits $4,690 High as Tariff Tensions Fuel Safe-Haven Surge
Gold prices really shot up to a brand new record high of $4,690.75 an ounce in Asian trading on Monday, sending shockwaves...
Quick overview
- Gold prices surged to a record high of $4,690.75 an ounce amid market panic following President Trump's tariff threats against European nations.
- Investors are flocking to gold as a safe haven due to rising geopolitical risks and expectations of potential Federal Reserve rate cuts.
- Technical analysis shows gold is trading within a rising channel, with key resistance at $4,690.30 and support levels at $4,638.42.
- While gold's bullish narrative remains strong, traders should be cautious of potential short-term volatility and corrections.
Gold prices really shot up to a brand new record high of $4,690.75 an ounce in Asian trading on Monday, sending shockwaves through the market after President Donald Trump threatened to impose new tariffs on eight European nations over his wild idea to buy Greenland. The safety-seeking crowd went scrambling for gold as investors snapped it up in anticipation of a spike in geopolitical risk. Spot gold was last seen sitting at $4,675.55 – that’s a 1.8% bump – and U.S. futures jumped 1.9% to $4,681.10.
The news sent markets into a panic, with European officials sounding the alarm about a looming transatlantic trade fight. Investors are now rushing for cover into precious metals like gold, desperately seeking shelter from the potential economic dangers looming in the wings.
Adding fuel to the gold rally are growing expectations that the Federal Reserve might start easing the brakes on monetary policy later this year. The soft numbers from the U.S. economy and the slowly cooling inflation have the bulls ready to make a case for rate cuts, which will push down the costs of holding onto gold.
Gold (XAU/USD) Technical Analysis: Rising Channel Still Looks Solid – But RSI is Suggesting the Party Might be Ending
Take a look at the 4-hour chart: gold (XAU/USD) is still trading just shy of $4,672.21, which puts it safely inside a rising channel. Gold is still making higher lows, but there’s a big ol’ ceiling at $4,690.30 – which happens to be the recent record high.
- Support levels: $4,638.42, $4,570.62, $4,523.34 – that’s where you might see a lifeline for gold if it takes a tumble
- Resistance levels: $4,690.30, $4,735.83, $4,778.18 – getting past this one might just see gold soaring right on through
- RSI: 66.29 – the momentum is sure strong, but it’s also getting pretty close to being overbought
- Moving Averages: Both the 50- and 200-period MAs are still trending up – but watch out for a possible change of heart
The RSI is suggesting that momentum is getting pretty tired out – a breakout above $4,690 might just open the door to new record highs, or even better, $4,735 and $4,778. However, if we can’t get past this resistance, a pullback to $4,638 or even lower might just be on the cards.
Gold (XAU/USD) Geopolitical Risk, Fed Policy – All Keeping the Bulls in Charge
Beyond just looking at the charts, the macro backdrop for gold is just as supportive as ever. Trump’s tariff threats, the ongoing tensions in the Middle East, and those dovish signals from the Fed – all of it is just driving more and more people to buy gold. Silver also got in on the action, jumping over 4% to a brand new record $94.03 an ounce. Its industrial use case really helped it on its way.
But with all the rate cuts on the horizon, and the geopolitical uncertainty really starting to rise – gold’s strong narrative remains intact. Even so, traders should be on the lookout for some short-term volatility as markets digest all the changes in policy, and all the latest global headlines.
Gold (XAU/USD) Trade Setup and Outlook
Gold’s breakout potential is still very much real – but so is the risk of a near-term correction right around the corner. Some possible trade setups to consider are:
- Buy above $4,690, targeting $4,735, with a stop-loss below $4,638
- Sell below $4,638, targeting $4,570, with a stop-loss above $4,690
As long as that rising channel keeps holding, dips might just be seen as buying opportunities – but if support breaks, we’re in for some sharper moves downwards.
- Check out our free forex signals
- Follow the top economic events on FX Leaders economic calendar
- Trade better, discover more Forex Trading Strategies
- Open a FREE Trading Account
Save