Following Friday’s big recovery, gold prices eased back a tiny bit but remained supported amid talks of the US dollar and yields forming a near-term top. This has effectively eroded the short-term bearish control, following last week’s break down below the $3,300 level, suggests Fawad Razaqzada, technical analyst at Trading Candles.
Gold’s resilience in the face of a stable equity market following the EU-US trade agreement suggests some investors still feel that the broad-based tariff process will be more of a burden than a boon for the global economy. That’s especially after some nations like Switzerland were slapped with higher rates.
While a major trade war has been averted for now, it is difficult to say to what extent this has reduced safe-haven demand for gold. But gold’s extraordinary rally and the parabolic-like moves in recent quarters would always come to an eventual pause, which has been the case in the last few months.
The metal is in need of a new major catalyst to drive it to new highs beyond the record $3,500 hit in April. Meanwhile, interim support now comes in at $3,335.
