- Gold price attracts some intraday sellers following an uptick to a fresh all-time peak on Thursday.
- A modest USD bounce and a positive risk tone prompt some profit-taking around the commodity.
- US-China trade war concerns, recession fears, and Fed rate cut bets could support the XAU/USD.
Gold price (XAU/USD) retreats after touching a fresh all-time peak earlier this Thursday and erodes a part of the previous day’s blowout rally, though the downside remains cushioned. A slight improvement in the global risk sentiment, bolstered by hopes of US trade negotiations, turns out to be a key factor undermining the precious metal. Adding to this, a modest US Dollar (USD) uptick prompts bullish traders to take some profits off the table and exert some downward pressure on the commodity.
Meanwhile, investors remain concerned about the potential economic fallout from US President Donald Trump’s aggressive trade policies. This, along with the rapidly escalating US-China trade war and global recession fears, could act as a tailwind for the safe-haven Gold price. Furthermore, the prospects for more aggressive policy easing by the Federal Reserve (Fed) could cap any further USD appreciation and contribute to limiting losses for the non-yielding yellow metal, warranting caution for bearish traders.
Daily Digest Market Movers: Gold price drifts lower as positive risk tone and modest USD bounce prompts profit-taking
- The US Census Bureau reported on Wednesday that Retail Sales climbed 1.4% in March, the most in over two years. The reading followed a revised 0.2% increase in the previous month and was better than the market expectation for a 1.3% rise.
- Adding to this Federal Reserve Chair Jerome Powell said the US central bank was not inclined to cut interest rates in the near future, citing the potential inflationary pressure stemming from US President Donald Trump’s aggressive tariffs policies.
- Meanwhile, the equity market in Asia-Pacific largely advanced on Thursday, which, along with the emergence of some US Dollar (USD) buying, holds back traders from placing fresh bullish bets and caps the upside for the Gold price.
- US President Donald Trump kickstarted a bitter trade war with China earlier this month and raised tariffs to an unprecedented 145%. China retaliated with 125% duties on US goods and imposed new export licensing restrictions on seven rare earths.
- The US government also imposed new licensing requirements and limited exports of H20 artificial intelligence chips to China. Meanwhile, China’s Foreign Ministry said that Beijing will pay no attention if the US continues to play the tariff game.
- Investors remain worried that tit-for-tat tariffs the world’s two countries are imposing on one another will hinder global economic growth. This keeps a lid on any optimism in the market and continues to support the safe-haven commodity.
- Moreover, traders are still pricing in the possibility that the US central bank will resume its rate-cutting cycle in June. This holds back the USD bulls from placing aggressive bets and further acts as a tailwind for the non-yielding yellow metal.
- Traders now look forward to the US economic docket – featuring the release of the usual Weekly Initial Jobless Claims, the Philly Fed Manufacturing Index, and housing market data – and Fed-speak to grab short-term opportunities.
Gold price dip-buying should limit any meaningful corrective decline; $3,300 mark holds the key for bullish traders
From a technical perspective, the daily Relative Strength Index (RSI) is holding above the 70 mark and flashing overbought conditions. This makes it prudent to wait for some near-term consolidation or a modest pullback before positioning for an extension of a well-established uptrend witnessed over the past four months or so. In the meantime, any corrective pullback could be seen as an opportunity to initial fresh bullish positions and is more likely to remain cushioned near the $3,300 mark. The latter should act as a key pivotal point, which if broken decisively could pave the way for deeper losses.
US Dollar PRICE Today
The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the strongest against the Swiss Franc.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.25% | 0.07% | 0.56% | 0.19% | 0.50% | 0.51% | 0.62% | |
| EUR | -0.25% | -0.23% | 0.26% | -0.11% | 0.22% | 0.21% | 0.34% | |
| GBP | -0.07% | 0.23% | 0.49% | 0.13% | 0.45% | 0.46% | 0.58% | |
| JPY | -0.56% | -0.26% | -0.49% | -0.38% | -0.06% | -0.15% | 0.07% | |
| CAD | -0.19% | 0.11% | -0.13% | 0.38% | 0.34% | 0.32% | 0.46% | |
| AUD | -0.50% | -0.22% | -0.45% | 0.06% | -0.34% | 0.00% | 0.11% | |
| NZD | -0.51% | -0.21% | -0.46% | 0.15% | -0.32% | -0.00% | 0.13% | |
| CHF | -0.62% | -0.34% | -0.58% | -0.07% | -0.46% | -0.11% | -0.13% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).
