GOLD - USD - Gold reacts positively to American inflation - 03/12/2025 (GMT)

Gold has held close to record highs since last week as geopolitical risks remain high. The latest American tariffs on steel and aluminium – including from friendly nations and blocs like the EU and Britain – were met with an announcement that 2018 European tariffs on American products would resume from 1 April. Uncertainty over trade wars is extremely high as both the USA and targetted nations often walk back new proposals very quickly after making them. Meanwhile Russia’s response to the proposed ceasefire is awaited. Lower American inflation seems positive because it might entrench further expectations for rates to be cut in June.

The price seems to be making another attempt at $2,960 in the aftermath of American inflation. The main technical factors in favour of a move up are the fairly strong response to 28 February’s intraday push below $2,900 and that the slow stochastic no longer signals overbought. However, second and subsequent tests are usually weaker and volume has declined in the last couple of days.

$2,850 or slightly below seems to be a strong zone of demand, so the price would probably bounce from there if tested again unless the fundamental situation changes significantly. It still seems likely that gold will reach $3,000 sooner or later, but the current situation makes finding a good entry with decent potential reward quite difficult unless there’s a retest lows from late last month.

This is my personal opinion, not the opinion of Exness. This is not a recommendation to trade.