We use cookies to offer a better browsing experience, analyze site traffic, personalize content, and serve targeted advertisements. By clicking accept, you consent to our privacy policy & use of cookies. (Privacy Policy)

$3,120 And Counting: Gold Price Tempo Strengthens After Milestone Gain

Michael Abadha Blockchain market writer
    Summary:
  • Gold price has multiple strong tailwinds as reciprocal tariff fears and geopolitical risk get escalated. Here's how it could play out.

Gold price broke its record highs for the third successive session in a row, rising by 1.3% to hit $3,128 on Monday. The momentum propelling the metal is driven by an uptick in risk sentiment, two days before US reciprocal trade tariffs enter into force. In addition, last week’s Personal Consumption Expenditure (PCE) Index figures confirmed fears that US inflation is on its way up and could get worse when tariffs gather momentum.

US President Donald Trump stated over the weekend that the reciprocal tariffs initially designed to target countries with a trade surplus over the US will now target all countries. That broadens the scope of the impact of elevated prices and has upped the risk in financial markets and the broader global economy. This scenario will drive up the demand for safe haven assets and augurs well for gold prices.

Elsewhere, Trump has adopted an unusual tone in his view of Russian President Vladmir Putin. The US President has expressed anger at Putin’s questioning of Ukraine President Volodymir Zelensky’s legitimacy, threatening an additional 50% tariff on Russian oil.

In addition, Trump threatened to bomb Iran if it fails to engage in direct nuclear negotiations. Iran has rejected the overture, potentially sets the stage for an escalation of geopolitical risk. This adds fuel for extended upside by XAUUSD.

Gold Price Prediction

Gold price pivots at $3,110 and action above that level signals control by the buyers. The metal will likely meet initial resistance at $3,130, but an extended upward momentum will break above that level to potentially test the second barrier at $3,140.

Alternatively, the price gradient could shift to the downside if it breaks below the pivot level. That will likely see the first support come at $3,095. However, an extended control by the sellers will break below that level and invalidate the upside narrative. In addition, that momentum could potentially test $3,077.