Another Record! Gold Rises Unstoppably! Rate Cuts Remain the Main Topic
Global gold prices continued their rally and briefly broke through a new record level above US$4,100 per troy ounce. This increase was driven by strong expectations that the Federal Reserve (The Fed) will soon cut interest rates, as well as escalating geopolitical tensions between the United States and China, which have triggered an influx of funds into safe-haven assets.
Market participants expect the Fed to cut interest rates by 25 basis points at its meeting next month after inflation data showed signs of slowing.
These expectations of a rate cut have depressed US bond yields and weakened the dollar, making gold more attractive as a non-yielding asset.
Furthermore, several Fed officials have begun to voice concerns about a slowing economy. This sentiment has strengthened investor confidence that the era of high interest rates is coming to an end.
"If the Fed truly begins its interest rate cut cycle this quarter, gold could break another new record before the end of the year," said a commodity analyst from Bloomberg Intelligence.
From a geopolitical perspective, relations between the US and China have heated up again after Washington reportedly tightened restrictions on chip technology exports to Beijing.
China responded by signaling restrictions on rare earth metal exports, sparking concerns about the global supply chain.
This situation has increased demand for gold as a hedge against global economic risks.
Several global central banks have also been seen increasing their gold reserves, while large investment institutions continue to increase their positions in gold-based instruments.
Bank of America even raised its gold price projection to US$5,000 per troy ounce by 2026, amid the prospect of broader global interest rate cuts.
Technically, gold prices are still moving in a medium- to long-term uptrend.
The nearest support level is in the US$4,050-US$4,100 area, while major resistance is in the US$4,150-US$4,160 range.
If the price breaks through this resistance, the potential for strengthening towards US$4,200-US$4,250 is greater.
Conversely, failure to break through this level could trigger a mild technical correction to the US$4,000 area before continuing its upward movement.
The RSI indicator remains in the neutral-bullish zone, while the MACD indicator shows continued positive momentum.
In the short term, a buy-on-dip strategy is still considered attractive, especially in the support area of US$4,050–4,100, with a target of US$4,150–4,200.
As long as the US dollar does not strengthen significantly and geopolitical tensions remain high, gold is expected to remain bullish. (mrv)
Source: Newsmaker.id
