The safe-haven asset remains in demand as market participants brace for potential disruptions in global trade.
Fed Rate Cut Expectations Support Gold’s Momentum
Market speculation that the Federal Reserve could cut interest rates twice this year has further fueled gold’s bullish momentum. Analysts suggest that easing inflationary pressures in the U.S. have raised the likelihood of monetary policy adjustments, making gold an attractive hedge against potential economic uncertainty.
“Gold remains well-positioned as investors anticipate rate cuts to support economic growth,” said a senior market strategist at a leading investment firm.
Despite a modest recovery in U.S. Treasury yields, which helped the U.S. Dollar (USD) rebound from a two-week low, gold’s upward trajectory has remained largely intact. The 10-year U.S. Treasury yield edged higher to 4.12%, providing some headwinds to further gold gains.
Silver Faces Pressure Amid Stronger Dollar
In contrast, silver (XAG/USD) struggled to maintain its footing, trading around $30.91 after hitting an intra-day low of $30.73. The modest recovery in the U.S. dollar, coupled with shifting expectations around the Fed’s rate decisions, has exerted downward pressure on silver prices.
Analysts point to silver’s industrial demand exposure, which makes it more susceptible to economic slowdowns compared to gold.
Gold is trading at $2,752.00, up 0.26%, showing resilience above key technical levels. The pivot point at $2,743.96 serves as a crucial support, with a sustained hold above this level favoring a bullish outlook. Immediate resistance is at $2,759.13, followed by stronger hurdles at $2,766.37.
On the downside, key support levels to watch are $2,734.19 and $2,724.42. The 50-day EMA at $2,700.43 and the 200-day EMA at $2,666.17 indicate underlying strength in the broader trend.
Notably, the emergence of a three white soldiers candlestick pattern signals potential bullish continuation, with a move above $2,759.13 likely to attract further buying interest. However, a drop below $2,743.96 could shift momentum towards the downside.