GOLD Analysis
Afternoon: Gold Holds Near $2,860 Amid Rate Cut Optimism & Geopolitical Tensions
Highlights:
- Gold prices steady around $2,860 as expectations for multiple rate cuts boost its safe-haven appeal.
- Weaker US services data fuels Fed rate cut bets, aligning with recent BoC and ECB rate reductions.
- Geopolitical uncertainty from US-China tensions, Iran negotiations, and Gaza concerns supports gold demand.
Overview:
Gold remains firm near $2,860 per ounce as investor sentiment shifts towards lower interest rates, increasing demand for the non-yielding metal. The latest US economic data revealed slower-than-expected service sector growth, signalling potential weakness in the coming months. This has strengthened expectations for two Federal Reserve rate cuts this year, aligning with the latest FOMC projections.
Additionally, global central banks are adopting dovish policies—the European Central Bank (ECB) and Bank of Canada (BoC) have both cut rates, with the BoC also halting quantitative tightening. The Reserve Bank of India (RBI) and Bank of England (BoE) are expected to follow suit, reinforcing the case for gold’s bullish momentum.
On the geopolitical front, US-China trade war concerns persist, while Trump's remarks on Gaza and Iran negotiations add uncertainty, pushing investors towards gold as a safe-haven asset.
Technical Analysis & Trade Strategy
- Support: $2,845 | Resistance: $2,890
- Action: Buy on dips near $2,860, targeting $2,885, with a stop loss below $2,845.
Support and Resistance Levels:
