15/10/25

87

Gold prices remain near off-peak levels but continue to maintain upward momentum amid a broadly weakened US Dollar. The metal’s recent ascent has been driven by renewed geopolitical tensions, particularly between the United States and China, as well as expectations of monetary easing by the Federal Reserve. Although gold has retreated slightly from its recent record highs, it continues to challenge the upper boundary of a rising channel on the daily chart, with technical indicators indicating that the asset remains heavily overbought.

Market sentiment remains bullish despite contrasting signals from global equities. Investors are buying gold on dips, reflecting its status as a safe-haven asset in uncertain times. The latest leg higher in gold prices appears to be fueled by escalating trade tensions: the US has floated potential restrictions on Chinese business dealings related to commodities like cooking oil, while trade friction persists with tit-for-tat tariffs and export controls. These developments have compounded worries about a prolonged trade dispute, undermining confidence in the US dollar.

Meanwhile, the market continues to price in multiple US Federal Reserve interest rate cuts. Despite the Fed’s cautious communication, market expectations suggest at least two reductions are likely by year’s end. Speculation about monetary easing, coupled with a stronger Chinese Yuan — driven by a surprise rate fix — has contributed to dollar weakness, providing further support for gold. The Dollar’s decline, along with its inverse correlation to gold, underpins the precious metal’s recent gains.

Technically, the bulls are eyeing a breakout above $4,184 — the upper limit of a recent rising channel — on the daily chart to push toward the psychological threshold of $4,250. Conversely, failure to sustain above this level could see prices retracting toward support levels near $4,036 or even below, with a breach of the lower channel boundary signaling a potential correction to around $3,950.

Historically, gold has maintained its role as a store of value and hedge against inflation and currency depreciation. As central banks continue diversifying reserves—adding significant quantities of gold—its appeal as a reliable financial asset persists. The metal’s inverse relationship with the US dollar and US Treasury yields drives its price movements, especially during periods of geopolitical uncertainty or economic downturns. The forthcoming market dynamics will largely hinge on US-China relations, monetary policy signals, and shifts in global risk appetite.