Key Points
- Spot gold rises 0.8% to $3,005.48/oz, after earlier dipping on position unwinding.
- Technical bounce lifts XAU/USD from $2,958.58 low to close at $3,002.76; high of session reached $3,010.28.
- Surge linked to demand for safety as U.S. prepares to enforce 104% tariffs on Chinese goods.
Gold reversed earlier losses and surged above the key $3,000 level on Tuesday, with spot prices up 0.8% to $3,005.48/oz, reflecting renewed safe-haven demand as global markets brace for economic fallout from the intensifying U.S.–China trade conflict. After dropping earlier in the session—likely on the unwinding of leveraged long positions to raise cash—bullion staged a sharp recovery driven by recession hedging and risk aversion.
The XAU/USD pair, as shown on the 15-minute chart, plunged to an intraday low of $2,958.58 before recovering to close at $3,002.76, with a session high of $3,010.28. This rebound coincided with a bullish MACD crossover, supported by a shift in the histogram into positive territory, while price action reclaimed all key moving averages (5, 10, 30), confirming short-term strength.
Rising Risk Spurs Safe-Haven Flows
The recovery in gold comes as traders rotate out of risk assets—including equities and high-yield currencies—amid mounting concern over the U.S. administration’s decision to implement 104% tariffs on Chinese imports. The price action reflects growing fear that a hostile trade war will trigger a sharp economic downturn. With equities fragile and volatility elevated, gold’s historic role as a store of value is back in focus.
The earlier sell-off in gold was brief and likely technical, as traders closed positions to meet margin calls or reduce risk exposure. However, once initial liquidation pressure faded, safe-haven demand reasserted itself, aided by broader weakness in the U.S. dollar and intensifying geopolitical stress.
Technical Perspective and Cautious Forecast
The bounce from $2,958.58 signals a key support zone has held. The next hurdle lies at $3,020–$3,030, a resistance band that may prove sticky without further macroeconomic deterioration. A sustained break above $3,050 could open the door to retesting all-time highs, especially if central banks hint at rate cuts or the dollar softens further.
Picture: Momentum shifts as MACD flips bullish on early session strength, as seen on the VT Markets app
In the near term, momentum indicators favour upside, but caution is warranted. A resumption of forced selling or a temporary easing of tariff rhetoric could cap gold’s rally. Still, as long as trade tensions remain unresolved and recession fears linger, gold is likely to stay well bid above the $2,980 floor.
