Gold prices surged to an unprecedented high of $2,956 during early trading on Monday in the North American session, defying a strong US Dollar and steady Treasury yields. The precious metal continues to shine as investors navigate a complex landscape of geopolitical tensions, mixed economic data, and shifting market sentiment.
- Spot Gold Crucial Update (24 February 2025)
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Key Drivers Behind Gold’s Record-Breaking Rally
- Geopolitical Uncertainty and Trade Policies
Investors are closely monitoring the evolving trade policies proposed by US President Donald Trump, particularly as tensions simmer between the US, Canada, and Mexico. Despite the delay in tariffs, concerns over fentanyl trafficking and illegal immigration remain unresolved, creating a risk-off environment that supports safe-haven assets like gold. - Mixed US Economic Data
Recent US economic indicators have painted a mixed picture. While the S&P Global Manufacturing PMI showed expansion, the Services PMI contracted, signaling uneven growth. Additionally, inflation expectations rose, and consumer sentiment deteriorated, as reported by the University of Michigan (UoM). These factors have bolstered gold’s appeal as a hedge against economic uncertainty. - Treasury Yields and Real Rates
The US 10-year Treasury yield dipped slightly to 4.443%, providing a tailwind for gold prices. Meanwhile, real yields, measured by the US 10-year Treasury Inflation-Protected Securities (TIPS), held firm near 2.017%. Lower yields reduce the opportunity cost of holding non-yielding assets like gold, further supporting its upward trajectory.
Technical Outlook: Can Gold Sustain Its Momentum?
Gold’s uptrend remains intact, but technical indicators suggest caution. The Relative Strength Index (RSI) is in overbought territory, signaling that the rally may be nearing exhaustion. While this could lead to a short-term pullback, the overall bullish sentiment remains strong.
- Resistance Levels: If gold breaks above the all-time high of 2,956,thenextkeytargetisthepsychological2,956,thenextkeytargetisthepsychological3,000 level.
- Support Levels: A drop below the February 21 low of 2,916couldseepricestestingthe2,916couldseepricestestingthe2,900 support zone.
What’s Next for Gold Investors?
Despite overbought conditions, gold’s rally is likely to continue as long as geopolitical and economic uncertainties persist. Investors should watch for developments in US trade policies, inflation trends, and Treasury yield movements, as these factors will play a critical role in shaping gold’s trajectory in the coming weeks.
In conclusion, gold’s record-breaking performance underscores its role as a reliable safe-haven asset in times of uncertainty. While technical indicators hint at a potential consolidation, the broader fundamentals suggest that the precious metal’s rally is far from over.
