Investors continue to relentlessly allocate capital into the safe haven commodity, fuelling its ascent to fresh record highs week after week, as a confluence of bullish catalysts supercharges their conviction.
The precious metal has recorded an impressive 40% gain year to date, its strongest gain performance since 1979 and analysts have upwardly revised their end of the year targets, forecasting that momentum will be maintained.
Ongoing geopolitical uncertainty, tariff impact ambiguity, looser policy conditions from central banks and signs of softness for the US labour market concocted a potent potion and are deemed as are the primary reasons aiding the bullion to higher ground.
More specifically, the recent breeches of Russian aircraft into NATO member nations’ airspaces alongside the shift in rhetoric in favour of Ukraine from President Trump, hinted that the resolution of the war in Ukraine will have trouble finding a swift solution. Furthermore, Israel’s war in Gaza rages on, with the IDF penetrating the city once again to once and for all expel Hamas fighters and set free their prisoners of war.
On the monetary front, the Federal Reserve’s first rate cut in 2025, alongside the projections for additional reductions of the key federal funds rate in the meetings to come, following signs of cracks of the US labour market, polished up the shine of the yellow metal and made it even more attractive in the eyes of investors.
Last but not least, the fact that central banks across the globe continue to shore up reserves of the safe haven asset and demand for gold ETF’s remains robust, are two additional key developments that could sustain the power rally of the commodity into new uncharted territory in the foreseeable future.
Technical Analysis
Gold Chart – Bulls get more bullish on the bullion’s bombastic breakout bonanza
Resistance: 3800 (R1), 3850 (R2), 3900 (R3)
Support: 3690 (S1), 3615 (S2), 3550 (S3)