Are Gold Bulls Preparing to Run: Watch These Levels!

Investor sentiment remains anchored in expectations that Trump’s proposed tariffs and protectionist trade measures could boost inflation, strengthening gold’s appeal as a hedge. Since mid-November, gold has traded between $2,583.91 and $2,726.30. A breakout is possible once clearer signals come from the new administration and the Fed’s January 28-29 meeting. The Fed remains cautious about rate cuts amid inflation above 2%, another key factor supporting gold.

Gold is set to gain 27% in 2024, its strongest annual performance since 2010, driven by strong central bank purchases, geopolitical tensions and the Fed’s rate-cutting cycle. A continuation of these factors into 2025 could provide the foundation for further gains.

Yields on U.S. Treasury bonds fell as bond markets reopened on Thursday. This reflected investor caution ahead of upcoming economic data. The 10-year yield closed 2024 above 4.5%, with volatile movements throughout the year. Investors are closely following unemployment claims and manufacturing data to learn more about economic health. As you follow on Kriptokoin.com, the Fed signaled a limited rate cut in 2025 in December. This suggests that gold will continue to benefit from the high interest rate environment that has been weighing on stock markets.

The dollar started 2025 with a slight weakness. On the other hand, the yen has shown a modest recovery from five-month lows. Forex markets continue to focus on the widening of the interest rate gap between the US and other economies. Thus, increasing demand for the dollar. However, a possible slowdown in US growth later in the year could challenge the dollar's long-term strength and indirectly support gold prices.

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