Gold Market Is Hot Again! Will It Break Through Psychological Levels Again?
The spot gold price has broken through the $3,320 per ounce level in early July 2025, strengthening by around 0.56% this morning in the Asian session. This movement was supported by the significant weakening of the US Dollar and the worsening market sentiment towards voluntary return assets such as stocks, although it has not completely escaped the pressure of global market optimism.
The Dollar Index (DXY) is near its lowest level since March 2022. When the Dollar falls, gold priced in USD becomes cheaper and more attractive to foreign investors.
The Fed's policy is also being increasingly monitored. The market is currently expecting a possible rate cut in September, which is marked by dovish sentiment from Fed officials. A typical rate cut lowers the opportunity cost of holding gold.
Although geopolitical tensions in the Middle East have eased, concerns about the next conflict and trade negotiations between the US, China, and Canada continue to be supporting factors for safe havens such as gold.
In the short term, the influence of the weakening dollar and expectations of the Fed's interest rate cut have so far provided encouragement with the resistance level in the area of $3310-$3330, while the support level is in the area of $3245-$3265
The medium term is also still getting strength from geopolitical issues and trade wars, especially with Japan and the European Union, and entering the gold buying season of central banks & Asia (India, China) in the third quarter, historically also supports prices. The potential target for the increase in the medium term is in the area of $3400-$3450 while the correction that can occur is in the range of $3150-$3180
Meanwhile, in the long term, the issue of global de-dollarization which has caused many countries to shift reserves from dollars to gold has begun to be heard, US fiscal uncertainty and high deficits risk causing further dollar weakness and structural inflation and long-term geopolitical risks remain the bullish foundation for gold. Gold has the potential to break through the $3500-$3600 area by the end of 2025, in an extreme scenario (major conflict, fiscal crisis, global inflation) the price could reach $3800, but if global risks subside and the Fed returns Hawkish gold could consolidate to $3000-$3100.
Source : (mrv@Newsmaker)
