Gold’s price (XAU/USD) trades above $2,910 on Tuesday, rebounding from earlier losses thanks to a potential German defence spending deal that weakened the US Dollar. This development has led traders to adjust positions, shifting Gold into a modest profit for the week.
Market dynamics are influenced by ongoing tariff disputes, notably between Canada and China, which have raised concerns about broader economic implications. These tensions coincide with US trade policy changes under President Trump, adding to market volatility.
Gold Price Levels And Key Resistance
Gold’s current performance shows it above the daily Pivot Point at $2,895, facing resistance at $2,910. Support is firmly positioned at $2,880, with lower levels around $2,873 and $2,857 acting as potential targets should a downturn occur.
Thailand’s currency, the Thai Baht (THB), has benefited from rising Gold prices, appreciating approximately 1.2% against the US Dollar this year, attributed to its status as a regional Gold trading hub. Meanwhile, the CME Fedwatch Tool indicates a 95% likelihood of no interest rate changes at the upcoming Fed meeting, with a 47.8% chance of a rate cut on May 7.
This latest movement in Gold prices stems primarily from a shift in currency strength, with the weakening of the US Dollar following discussions in Germany concerning higher defence spending. Such budgetary policy changes often lead to a reassessment of risk appetite among traders, as we have seen here. With Gold now trading above $2,910, it marks a recovery from earlier losses, providing buyers with an opportunity to benefit from the adjustment.
Looking at the broader market, global trade tensions continue to shape sentiment. The dispute between Canada and China, while not as widely discussed as US-China trade policies, brings an additional layer of uncertainty. These tensions can spill over into commodity markets, influencing demand and price stability. President Trump’s latest moves on US trade policy further complicate matters, pushing investors toward safe-haven assets like Gold. Volatility in these areas remains a consistent driver for entry and exit points in trading strategies.
Currencies And Interest Rate Expectations
From a technical perspective, prices currently sit above the daily Pivot Point of $2,895. The primary resistance level of $2,910 remains in place, and should momentum continue, we may see further tests of strength around this mark. Support is firmly set at $2,880, with further possible downward moves reaching as low as $2,857. If sellers begin to dominate, these levels could quickly come into play, making them relevant for short-term traders focused on market structure.
Currency movements continue to be another factor worth monitoring, particularly in Thailand, where the Thai Baht has strengthened by approximately 1.2% against the US Dollar this year. Thailand’s role as a key regional hub for physical Gold trading has undoubtedly contributed to this appreciation, reinforcing the correlation between Gold’s movement and its local currency. This dynamic benefits Baht holders, as stronger Gold prices often translate into capital inflows into the Thai market.
Meanwhile, market expectations regarding Federal Reserve policy remain stable, with the CME FedWatch Tool pointing to an overwhelming 95% likelihood of no change in interest rates during the upcoming meeting. However, expectations for a rate cut in May have risen to 47.8%, a figure worth paying attention to. With such a probability, any comments from Federal Reserve officials in the coming weeks could quickly influence the outlook, especially for those trading rate-sensitive assets.
