Gold price climbs 2% as newly implemented U.S. tariffs boost safe-haven demand
FUNDAMENTAL OVERVIEW:
Gold prices (XAU/USD) rebounded to $3,045 on Wednesday, recovering after dipping earlier in the week, as U.S. President Donald Trump’s tariffs officially took effect. Earlier hopes for a last-minute resolution had buoyed market sentiment, with reports on Monday suggesting Trump was considering a 90-day delay in imposing tariffs on all countries except China.
Earlier this week, gold had slipped below $3,000 per ounce—its lowest level since March 13. This decline followed a record high on April 3, reached shortly after the initial tariff announcement. However, sharp losses in broader financial markets prompted investors to liquidate gold positions to cover losses elsewhere.
The implementation of tariffs has revived gold’s safe-haven appeal. Market attention is now shifting toward China’s potential response and any forthcoming signals from the Federal Reserve regarding its stance amid rising recession risks.
Additionally, growing expectations of multiple interest rate cuts by the Federal Reserve (Fed) this year—driven by concerns over a potential tariff-induced U.S. economic slowdown—are further boosting demand for non-yielding gold. Moreover, continued selling pressure on the U.S. Dollar (USD) is also supporting the bullish sentiment around the XAU/USD pair ahead of the release of the FOMC meeting minutes.
GOLD TECHNICAL ANALYSIS CHART:
Technical Overview:
Gold is trading within an up channel.
Gold is moving below 50&100 Moving Averages (SMA).
The Relative Strength Index (RSI) is in Neutral Zone, while the Stochastic oscillator suggests Positive trend.
Immediate Resistance level: 3055.00
Immediate support level: 3005.80
HOW TO TRADE GOLD
After edging higher, gold faced rejection and began a corrective move to the downside. Recently, it tested a key support level and rebounded to the upside. It has since broken above the previous day’s high and breached a significant resistance zone. Currently, gold is undergoing a pullback, potentially retesting its newly formed support area. If this zone holds, the bullish momentum is likely to continue toward the next resistance level.