gold prices took a momentary pause on Thursday after reaching a three-month peak of $2,763 on Wednesday. Market participants in the gold trading arena are currently consolidating gains as they await key economic indicators from the U.S., particularly the weekly Jobless Claims, which could significantly influence market sentiment.
The recent uncertainty surrounding President Trump’s proposed tariffs could be impacting gold prices, as his plan includes imposing substantial tariffs on Mexico, Canada, and China. This uncertainty seems to have overshadowed emerging optimism from China, stemming from recent economic support measures implemented by local authorities.
The potential ramifications of Trump’s tariff proposals may lead to diminished demand for safe-haven assets such as the U.S. Dollar, gold , and U.S. Treasury bonds. In turn, this could contribute positively to U.S. Treasury yields while creating a complex backdrop for traders in the gold market. Meanwhile, renewed optimism in Chinese equity markets, stimulated by supportive measures from the Chinese Securities Regulatory Commission, may continue to lend support to gold prices.
Attention is now focused on upcoming U.S. economic data that could offer insights into the Federal Reserve’s interest rate policies for the remainder of the year. The market is currently factoring in an easing of 37 basis points by the Fed this year, with expectations of the first rate cut perhaps not materializing until July. If the economic indicators released on Thursday show weakness, it could reinforce the probability of multiple rate cuts from the Fed this year, returning focus to demand for gold as a staple asset.
From a technical perspective, gold continues to exhibit bullish momentum. The metal is currently positioned to challenge its record high of $2,790, backed by a breakout from a symmetrical triangle pattern and support from key moving averages. However, if gold retraces, it may test lower levels around $2,742, or even $2,700, should negative sentiment take hold. The forthcoming Jobless Claims data will be pivotal, with analysts closely monitoring trends for indications of labor market strength or weakness, which could dramatically affect the performance of the U.S. Dollar and, consequently, gold prices.
