- The price of gold rises on Thursday after two days of firm sales pressure.
- The president of the United States Trump goes back in previous statements, China could receive a new tariff rate in the next two to three weeks.
- The markets are back to the exit box with the downward shares and the golden shelter gold being demanded.
The price of gold (Xau/USD) is becoming positive again, recovering above the level of $ 3,300 at the time of writing after two days of firm sales pressure since it reached $ 3,500 on Tuesday. The president of the United States, Donald Trump, issued more comments from the Oval office on Wednesday night, noting that China could receive a new tariff rate in the next “two to three weeks”, while countries that are currently in the negotiation phase could see reciprocal tariffs if negotiations do not go as Trump wishes, Bloomberg reports.
Meanwhile, US Treasury Secretary Scott Besent said Wednesday that the previous comments of President Trump were not an offer to unilaterally reduce US tariffs on China. When asked if there was not a unilateral offer of the president to descale, Besent replied “Not at all,” says Bloomberg. The Treasury Secretary said the administration is considering multiple factors, not only tariffs, but also non -tariff barriers and government subsidies for China.
What moves the market today: SNB records profits for gold fever
- The Swiss National Bank (SNB) has reported that its gold holdings allowed the Central Bank to report a gain in the first quarter. The SNB registered a gain of 6.7 billion Swiss francs (CHF) from January to March, said the Central Bank in a statement on Thursday, Bloomberg reports.
- Gold futures in Shanghai followed the recent massive sale in gold and registered the greatest intradication since 2013. Chinese investors rushed to take profits under the assumption that a commercial agreement between China and the US was imminent after the comments of President Donald Trump on Tuesday and Wednesday.
- Several trading firms are still pointing out a healthy purchase of gold. “Trump’s temporary respite has vanished,” said Priyanka Sachdeva, an analyst based in Singapore of Philip Nova Pte. “Investors who lost the opportunity to buy in the fall at the beginning of April promoted today’s increase.” Bloomberg reports.
Technical analysis of the price of gold: half cook
Gold is seeing a slight recovery on Thursday and quotes above $ 3,300 after a rather hard correction. However, technical traders may not be so happy to observe the action of the daily price, with gold being rejected at the top at 3,367 $ earlier in the day, which coincides approximately with the daily resistance R1 in 3,363.
When observing the technical levels, the daily pivot point at $ 3,311 has already been recovered in the first Asian operations, with the intradic resistance R1 already tested and rejected in 3,363. Above, the price of gold could extend the recovery towards R2 resistance in 3,438.
At the bottom, a land is being formed about $ 3,245 (maximum of April 11) as a key technical level, with S1 support in $ 3,236 just below. In the event that this area is not maintained, the S2 support at $ 3.185 and the key technical level at $ 3,167 (maximum of April 3) should contain any downward pressure.
Xau/USD: Daily graphic
FAQS GOLD
Gold has played a fundamental role in the history of mankind, since it has been widely used as a deposit of value and a half of exchange. At present, apart from its brightness and use for jewelry, precious metal is considered an active refuge, which means that it is considered a good investment in turbulent times. Gold is also considered a coverage against inflation and depreciation of currencies, since it does not depend on any specific issuer or government.
Central banks are the greatest gold holders. In their objective of supporting their currencies in turbulent times, central banks tend to diversify their reserves and buy gold to improve the perception of strength of the economy and currency. High gold reserves can be a source of trust for the solvency of a country. Central banks added 1,136 tons of gold worth 70,000 million to their reservations in 2022, according to data from the World Gold Council. It is the largest annual purchase since there are records. The central banks of emerging economies such as China, India and Türkiye are rapidly increasing their gold reserves.
Gold has a reverse correlation with the US dollar and US Treasury bonds, which are the main reserve and shelter assets. When the dollar depreciates, the price of gold tends to rise, which allows investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rebound in the stock market tends to weaken the price of gold, while mass sales in higher risk markets tend to favor precious metal.
The price of gold can move due to a wide range of factors. Geopolitical instability or fear of a deep recession can cause the price of gold to rise rapidly due to its condition of active refuge. As an asset without yield, the price of gold tends to rise when interest rates lower, while the money increases to the yellow metal. Even so, most movements depend on how the US dollar (USD) behaves, since the asset is quoted in dollars (Xau/USD). A strong dollar tends to keep the price of gold controlled, while a weakest dollar probably thrusts gold prices.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
