Article by: ETO Markets

Gold prices have surged to an all-time high around $3,077–3,078 during the Asian session on Friday, buoyed by a flight to safety amid escalating global trade tensions. Uncertainty over US President Trump's reciprocal tariffs, including the recent 25% tariff on imported cars and light trucks set for April 3, has dampened investor sentiment toward riskier assets and spurred safe-haven flows into gold. Additionally, concerns that Trump's aggressive trade policies might slow economic growth are raising expectations that the Federal Reserve could resume its rate-cutting cycle, thereby weakening the US Dollar and further supporting gold’s appeal. While slightly overbought conditions have restrained new bullish bets ahead of the upcoming US Personal Consumption Expenditure (PCE) Price Index release, recent stronger-than-expected macro data and hawkish comments from Fed officials have added complexity to the outlook, leaving investors closely watching for signals that could shape the trajectory of US monetary policy and gold price dynamics.

From a technical perspective, gold's recent bullish performance near the $… psychological level indicates that the path of least resistance remains upward, supported by a steady three-month uptrend. However, the daily Relative Strength Index (RSI) is signaling overbought conditions, suggesting that traders should be cautious and perhaps wait for a period of consolidation or a modest pullback before committing to further long positions. Notably, any corrective moves have seen dip-buying activity around the $…–$… zone, which appears to help cap downside risk near the $…–$… region. Conversely, a sustained break below these levels could trigger technical selling, potentially dragging the price down past the $…–$… intermediate support and reverting back toward the $… mark—a pivotal threshold for short-term traders that, if decisively breached, could pave the way for a significant near-term decline.