Since last week, gold has been unlikely to reduce with a rally in world stock markets with signs that the world trade war has decreased, especially between the United States and China.
Both transactions for gold and gold manipulation fell by about 6.5 percent compared to the highest levels of all time that they reached on Tuesday. Investors may have begun to make a profit from precious metal from a decrease in demand for the port. According to strategists at Barclays PLC, Golden Rally seems technically tense after the last rise. Meanwhile, Bloomberg said that hedge -funds have reduced a pure long process and the position of the option for gold to the lowest level of more than a year.
“This can show that there are more descending cards for gold. This can worsen with a weak long -term guarantee that has become incredibly crowded in trade, ”wrote Michael Brown, a senior strategist from Pepperstone to Pepperstone, that the interest rate is reduced in Asia, especially in Asia.
An important factor in euro power in 2025
From the economic uncertainty caused by the customs duties of US President Donald Trump, the demand for safe port assets has increased. Gold, which is a traditional asset used to protect against financial crises and inflation, increased by more than 25 percent this year and showed better than in world markets. Indirectly, the power of the euro, which significantly suppressed the US dollar, also contributed to the growth of precious metal.
The feeling of “exclusivity of the United States” sharply pulled the dollar in 2025, while the euro was noticeably fortified with the dollar as an asset of shelter. Since the beginning of February, EUR/USD parity has increased by 11 percent. “The power of the euro and the weakness of the US dollar, the geopolitical risk that showed concerns in the US dollar, and also became the main driving force of gold,” he said in a statement by the World Golden Council. The growth in euros made gold less expensive for European investors, and in March Gold ETF purchases in Europe, which reached $ 1 billion in Europe, made Europe the second largest buyer among regions.
Downward risks encountered in the near future
Nevertheless, gold may encounter a lower risk in the near future, depending on various factors, such as reducing the risk of running, excessive consumption signals, liquidity risks and slowing down the purchase rate of global central banks.
The main reason for the withdrawal of gold was that after Trump said that he would “significantly” reduce customs duties for China, the perception of risk and causing large scale in world stock markets. Last week, large stock exchanges compensated for April losses with signs that the tensions in the US trade war were reduced. Changes in relation to Trump can lead to reconstruction of portfolios among fund managers and individual investors.
Secondly, the gold jumped over a very short period of time and usually led to the technical excessive formation of purchases. Investors, as a rule, make profit and form short positions in accordance with such signals, and the options of options reflect these trends, in particular.
Thirds, central banks and individual investors can slow down the level of purchase from a sharp increase in prices. Economic uncertainty will also affect the ability to invest in retail investors.
Finally, gold ralles are usually supported by free monetary policy and high liquidity conditions. Nevertheless, the risks of inflationists associated with the customs duties of Trump can lead to the fact that the central banks slowed down the rate of reduction in interest rates. Trump’s management may also try to tighten state expenses and cause liquidity congestion.
Nevertheless, Brown expects to continue the growth of gold from continuous uncertainty: “Nevertheless, given all the uncertainty and bustle in other places, gold seems to be the best bet as a shelter.”