The gold price forecast remains stable, experiencing minor fluctuations during the European trading session on Tuesday. Despite hovering close to its all-time peak reached the previous day, the market remains cautious. The recent decision by the US government to pause tariffs on Mexico and Canada has improved investor confidence. However, the risk-on sentiment and the Federal Reserve’s (Fed) cautious stance have lifted US Treasury yields, strengthening the US Dollar (USD) and limiting gains for gold.
Gold Price Faces Resistance Amid Market Uncertainty
Although gold price forecast saw a slight dip, it found support before breaking below the $2,800 mark. Concerns about the economic consequences of US trade policies continue to sustain gold’s appeal as a safe-haven asset. Additionally, market speculation suggests that President Trump’s protectionist measures may drive US inflation higher, boosting gold’s status as a hedge against inflation. This situation indicates that gold’s primary trend remains bullish, with any pullbacks likely presenting buying opportunities.
Mixed Economic Indicators Support Bullish Sentiment
Uncertainty surrounding trade policies has fueled gold’s latest rally, pushing prices to record levels. Meanwhile, US economic data has shown a mixed performance. The Institute for Supply Management (ISM) Manufacturing PMI climbed to 50.9 in January, exceeding forecasts. Additionally, inflation-related indicators such as the Prices Paid Index rose to 54.9 from 52.5. Employment figures also saw improvement, with the Employment Index reaching 50.3 from 45.4, and the New Orders Index increasing to 55.1.
Despite these positive numbers, concerns persist that Trump’s tariffs could elevate inflation, reducing the likelihood of aggressive interest rate cuts by the Federal Reserve. Chicago Fed President Austan Goolsbee has warned that policy uncertainty may delay further rate adjustments. Similarly, Atlanta Fed President Raphael Bostic has noted that while the US labor market remains resilient, trade tensions continue to impact economic expectations.
Gold Price Bulls Maintain Control
From a technical perspective, the Relative Strength Index (RSI) suggests slightly overbought conditions. This signals the possibility of a near-term consolidation or a minor pullback before further price advances. If gold declines below the $2,800 support level, buyers may step in near the $2,773-$2,772 resistance-turned-support zone. However, further selling pressure could push prices lower toward $2,755, with extended declines reaching $2,725-$2,720 and even $2,700.
On the upside, a break beyond $2,830, the recent record high, could encourage more bullish momentum. If buyers maintain control, the long-term trend, which began at the December low of $2,583, could continue its upward trajectory.
Conclusion
Gold prices remain stable near record highs, with trade tensions and inflation concerns continuing to support the metal’s value. As traders assess the impact of US economic data and Federal Reserve policies, gold’s trajectory remains biased to the upside. Investors looking for expert insights on market trends can explore more at Daily Gold Signal. For the latest updates on daily gold movements, visit the Daily Gold Update.
