Article by: ETO Markets
Gold (XAU/USD) has extended its bullish momentum beyond $…, primarily driven by a confluence of geopolitical and monetary policy factors. President Trump's proposed 25% tariffs on Canada and Mexico, potentially effective February 1, have injected fresh uncertainty into global trade dynamics, boosting safe-haven demand. This development, coupled with the Fed's projected rate cuts for 2025 (albeit at a more measured pace than previously anticipated), provides a supportive backdrop for precious metals. While recent robust U.S. employment data suggested potential constraints on the Fed's rate cut trajectory, the evolving trade policy landscape has overshadowed immediate economic indicators. Institutional flows remain robust, evidenced by elevated trading volumes (…) accompanying the breakout above $…. Near-term catalysts include the Bank of Japan policy decision on Friday and global PMI releases, though market focus remains primarily on trade policy developments and their implications for global risk sentiment.
The technical framework presents a compelling bullish setup, with prices establishing firm support above the previous resistance zone. Key support levels have formed at $…-… (previous resistance turned support, validated by high volume node) and $…-… (psychological level with recent consolidation base). The 50-day moving average at $… represents a crucial medium-term support level. On the upside, immediate resistance emerges at $… (today's high), followed by the all-time high at $… (October 2024 peak). The momentum structure remains constructive above $…, though some consolidation may occur near resistance levels due to thinner volume profile above current prices.
