Will Gold Price Surge Before Trump’s Inauguration?


Will Gold Prices Surge Before Trump’s Inauguration?

Gold price experienced volatility on Monday as investors awaited clarity from Donald Trump’s inauguration speech, which could provide critical insights into the new administration’s policies. Spot gold saw modest decline early morning to test the support of $2,690, after earlier dropping by 0.5%. U.S. gold futures also saw a slight dip, down 0.3% at $2,731.1 per ounce. One of the most important factors that has led to lower gold price is the easing of tensions in the Middle East. On Sunday, Israel released 90 Palestinian prisoners in exchange for three hostages freed from Gaza, marking the beginning of a ceasefire after 15 months of conflict. In times of political unrest or war, investors often buy gold as a “safe-haven” asset to protect their wealth. With the situation improving, demand for gold has fallen. Additionally, President-elect Trump’s proposed trade tariffs could raise inflation, boosting gold’s appeal as an inflation hedge. While geopolitical stability may pressure gold in the short term, lower interest rates and inflation concerns could support its price in the medium to long term.

Looking ahead, investors are keeping an eye on the inauguration of President-elect Donald Trump. His proposed trade tariffs are expected to drive inflation, which could make gold more attractive as a way to protect against rising prices. Additionally, weaker-than-expected U.S. inflation data has raised hopes that the Federal Reserve may cut interest rates further this year, which would reduce the cost of holding gold, potentially boosting its appeal.

Investors are closely watching Trump’s inauguration speech, anticipating his trade policies, particularly on tariffs, which could trigger inflation and trade tensions, driving more demand for gold as a safe haven. In his pre-inauguration speeches, Trump outlined plans to reverse Biden’s policies, focusing on border security, tackling illegal immigration, and ending the war in Ukraine. His swearing-in ceremony marks the start of his second term, with policies expected to impact the global economy and markets.

The swearing-in ceremony, set to be a grand event with foreign dignitaries in attendance, marks the beginning of Trump’s second term as the 47th President of the United States, and his policies are expected to influence the global economy and markets in the coming months.

Technical Outlook: Gold Price (XAU/USD- ready for breakout or breakdown?)

The Gold Spot market is at a pivotal point, with the next major move dependent on how prices interact with key levels of $2727 and $2690. A breakout above $2727 would align with the existing bullish trend, potentially driving prices higher toward significant targets. Conversely, a breakdown below $2690 would signal a bearish reversal, opening the door to a test of support near $2660.

The emergence of a Bearish Harami candlestick pattern signals caution for bullish traders, as it suggests a potential shift in market sentiment. However, this bearish signal will only gain confirmation if the price breaks below $2690. For now, gold prices remain volatile, encountering strong resistance around the $2715 level, just ahead of the $2724–$2725 zone, which marked a one-month high last Thursday. If gold sustains its upward momentum, further gains could push prices toward $2745 as an intermediate resistance, with higher targets near the $2760–$2762 range.

However, the market is not without its risks. A significant drop below immediate support at $2700–$2690 could spark concerns, though such pullbacks are likely to be viewed as buying opportunities. If prices decline further, the $2665–$2660 range should act as a crucial support zone. This area is reinforced by an ascending trendline from November’s swing low and the 100-day Exponential Moving Average (EMA). Should prices fail to hold this level, the next supports lie at $2645 and the $2620–$2615 region.

Until then, Happy Trading!

Commodity Samachar Securities
We Decode the Language of the Markets

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