- The price of gold pulled back and broke below the $2600 level again.
- Meanwhile, attempts by the gold price index to return to the resistance level of $2,639 per ounce during the Christmas holidays failed.
Overall, continued gains in the US dollar supported the bears in pushing the price of gold bullion to $2,596 before current gold prices stabilized around $2,607 at the time of writing this analysis. The gold market has recently been significantly affected by changes in the future policies of the US Federal Reserve. At its last meeting in 2024, the US Federal Reserve cut interest rates by a quarter of a point as expected, but gave no indication of accelerating the pace of cuts through 2025, increasing selling pressure on gold. During 2024, the US Federal Reserve lowered interest rates by 100 basis points, and in 2025, markets expect the bank to lower US interest rates twice instead of the previous expectation of four times.
Why have gold prices fallen again?
According to gold trading platforms, gold prices were negatively affected by tightening signals from the US Federal Reserve on concerns that Trump’s official policy could lead to another increase in the inflation rate in 2025. This could affect the price of gold in the fourth quarter of 2024. Recent data on the US economic data is better than expected, increasing speculation that the US Federal Reserve may adopt fewer interest rate cuts in the new year 2025, which would be negative for the gold market.
Will gold prices rise in the coming days?
Furthermore, we still expect the recovery of gold prices in the coming period. We must not forget that global geopolitical tensions are not over but are increasing, and this is an important environment for gains in the gold market. Historically, gold prices have been supported by growing safe-haven demand during 2024, led by Russia’s Ukraine wars, the Israeli-Palestinian conflict with Lebanon and the conflict’s spread to strikes in Yemen. According to trading data, gold prices rose on the back of heavy buying by global central banks, led by the People’s Bank of China’s efforts to increase reserves, which pushed prices to a record $2,790 in September.
In the new year of 2025, gold investors will focus on uncertainty about US monetary policy, the reaction to Trump’s trade wars and China’s efforts to revive economic growth.
Trading Tips:
Always let gold be the pillar of the investment portfolio, because the historical path of gold prices is upward. Also, don’t forget that the price of gold is heading for its best annual performance in 10 years.
Gold price technical analysis and expectations today:
There is no doubt that gold moving below $2,600 an ounce increases bearish dominance, but it will not change the broader uptrend on the daily chart. A return of gold prices to the resistance level of $2645 and $2666, respectively, will give the bulls the momentum they need to move towards the psychological resistance of $2700 per ounce again. Conversely, and during the same time frame, the movement of gold prices towards the support levels of $2605, $2585 and $2558 per ounce will be important for gold investors to consider buying gold again.
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