Black Friday and Its Relationship to Gold
Global gold prices are expected to experience volatility ahead of Black Friday celebrations in the United States this week, following a decline in trading volume and a shift in investor strategies for the end-of-year shopping season. Black Friday, celebrated the day after Thanksgiving, has historically influenced the direction of precious metals trading due to reduced liquidity and shifts in risk sentiment in financial markets.
As the US national holiday period approaches, market activity typically decreases significantly, making price fluctuations more sensitive to sentiment and fundamental news. Institutional investors often take advantage of this situation to adjust their portfolios ahead of the year-end, which can trigger sharp spikes or declines in gold prices.
Furthermore, the Black Friday discount season also boosts consumer spending in the US, including in the gold jewelry and physical precious metals sectors. This physical demand provides additional support for gold prices, particularly in Asian and Middle Eastern markets, where the year-end holiday season has seen increased demand for gold jewelry.
Historical Example: Black Friday Rally & Its Impact
On Black Friday 2023, gold showed a recovery trend after pressure at the start of the week, with analysts predicting a potential rally due to a weakening dollar and increased safe-haven appetite. Meanwhile, on Black Friday 2024, gold also managed to reduce weekly losses as the US dollar weakened in thin trading ahead of the long holiday, underscoring the significance of currency movements for the precious metal.
Conclusion
Black Friday does not provide a single pattern for gold's direction, but historically, periods of thin liquidity and investor defensive strategies near the end of the year often create opportunities for significant volatility. This situation is of particular concern for market participants preparing to capitalize on price momentum, both for long-term accumulation and short-term trading.
Gold remains a key asset on the global safe-haven map, and any new developments in inflation, interest rate policy, and geopolitics are expected to be key catalysts determining the direction of the precious metal in the coming weeks.
What is the scenario for Black Friday 2025 for gold?
Gold prices are expected to fluctuate dynamically ahead of Black Friday, with market participants closely monitoring the direction of Federal Reserve monetary policy, global geopolitical developments, and potential changes in demand for safe-haven assets. Currently, gold is trading sensitively to a combination of risk-on and risk-off sentiment, making the outlook for short-term movements crucial for traders.
Bullish Scenario: Rally Opportunity if Resistance Breaks
Gold has the potential to continue its rally if it breaks through the strong resistance area in the US$4,180–4,200 range. If a breakout occurs, the price is expected to move towards US$4,220–4,250 or higher. This momentum could be triggered by supporting factors such as a dovish signal from the Federal Reserve, a weakening US dollar index, or escalating global geopolitical tensions that could increase demand for safe-haven assets.
For market players, a strategy often considered is "buy on breakouts" or "buy on dips" when the price corrects to the US$4,160–4,150 support zone.
Consolidation Scenario: Sideways Risk During Low Liquidity
If the market tends to be cautious ahead of Black Friday, coupled with relatively low trading liquidity, gold has the potential to move sideways within the US$4,140–4,190 range. This condition reflects uncertainty about the direction of the main trend and increases the risk of false breakouts, which short-term market players should be wary of.
Bearish Scenario: Downward Pressure If Sentiment Changes
A correction is likely if gold fails to break through resistance and sentiment strengthens the US dollar and Treasury yields. Under these conditions, prices could weaken towards the crucial support level of US$4,120–140. If this level is breached, the decline could extend to the US$4,000–3,980 area.
In this phase, a conservative approach, such as waiting for signs of a trend reversal or considering short positions for traders with an aggressive risk profile, could be a relevant strategy.
Source: Newsmaker.id
