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Gold price surges over 1.5% this week as Trump’s tariff deadline approaches.
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Markets prepare for reciprocal tariffs, with Trump set to impose them globally.
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Gold traders eye further gains, targeting $3,200 as the next key level.
Gold prices continue to rise for the second consecutive day this week and the first trading day of Q2 2025, with the precious metal trading slightly above $3,130 at the time of writing. A new all-time high of $3,149 was recorded on Tuesday, as investors seek refuge in gold ahead of U.S. President Donald Trump’s reciprocal tariff announcement, scheduled for Wednesday at 19:00 GMT.
Meanwhile, traders brace for a highly active trading week with significant U.S. economic data releases. Leading up to the Nonfarm Payrolls (NFP) report on Friday, markets will closely monitor key indicators. In a CNBC interview, Richmond Federal Reserve (Fed) Bank President Thomas Barkin highlighted the uncertainty in economic readings, making it difficult for policymakers to determine future interest rate decisions, while concerns about a potential recession persist.
Market Movers: Key Events Shaping the Gold Rally
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Gold’s surge boosts South African mining stocks, which posted their best monthly performance on record, rising 33% in March, according to Reuters. This strong rally has helped shield the country’s benchmark index from global market turmoil.
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The CME FedWatch tool shows the probability of a May rate cut declining to 13.1% (from 18.1% on Monday), while the chances of a June cut remain the highest, with a 23.1% probability of rates staying unchanged.
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Morgan Stanley commodity strategist Amy Gower attributes the gold rally to strong physical demand and a favorable macroeconomic backdrop, predicting gold could reach $3,300–$3,400 this year. Similarly, Goldman Sachs forecasts gold prices hitting $3,300 by year-end, as reported by Bloomberg.
Gold Price Technical Outlook: Key Levels to Watch
A cautionary note on the sustainability of this gold rally is warranted. As the main catalyst—the reciprocal tariffs—will soon be officially announced, traders should consider the “buy the rumor, sell the fact” strategy. Once the tariffs take effect, a temporary pullback in gold could occur due to profit-taking, especially if subsequent trade negotiations lead to partial reversals.
Upside Targets:
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R1 Resistance at $3,142 has already been tested during Tuesday’s sharp rally.
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R2 Resistance at $3,160 remains a key level, which could still be reached later in the U.S. session.
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Broader upside target: $3,200 if bullish momentum persists.
Downside Support Levels:
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Pivot Point at $3,109 is expected to hold against selling pressure.
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S1 Support at $3,091 is a secondary level that could be tested without fully reversing recent gains.
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S2 Support at $3,058 serves as the last major level preventing gold from dropping below $3,000.
As the market awaits Trump’s tariff announcement and key economic data releases, gold prices remain at a critical juncture, with potential for further gains but also heightened volatility ahead.
XAU/USD: Daily Chart
