Gold Prices Eye $2,960 as Inflation Data Looms – What’s Next?
Gold prices are hovering near $2,897, holding key support levels as investors brace for upcoming inflation data and Federal Reserve signals.
The weaker U.S. dollar and declining Treasury yields have bolstered gold’s appeal, but uncertainty surrounding trade tensions and economic growth continues to weigh on sentiment.
Markets remain focused on Wednesday’s Consumer Price Index (CPI) report, which could shape expectations for interest rate policy. With recent tariff hikes on Mexico, Canada, and China fueling concerns about rising costs, traders are looking to gold as a safe-haven asset amid economic uncertainty.
However, despite gold’s stability, the metal remains trapped within a tight trading range, struggling to gain the momentum needed for a breakout. Can bulls reclaim $2,900, or is gold primed for a deeper pullback?
Trade Tensions and Inflation Fears Drive Gold Demand
Gold has historically thrived during periods of economic and geopolitical instability, and the current environment is no exception. Former President Donald Trump’s new 25% tariffs on imports from Mexico, Canada, and China have rattled global markets, sending investors toward safer assets.
Trump’s tariff policies have increased economic uncertainty, raising concerns about inflation.
The U.S. dollar index (DXY) remains near a four-month low, making gold more attractive for foreign buyers.
10-year U.S. Treasury yields are falling, reducing the opportunity cost of holding non-yielding assets like gold.
While gold has benefited from these developments, market momentum remains weak. Traders are looking for confirmation that inflation concerns will push the Federal Reserve toward rate cuts—an event that could ignite a fresh rally for gold.
Technical Outlook: Key Levels to Watch
Gold’s price action suggests strong support at $2,879, where buyers have stepped in to prevent further declines. The ascending trendline remains intact, providing a crucial barrier against deeper losses. However, upside resistance at $2,903 (50-period EMA) continues to limit gains.
Gold’s Key Technical Levels:
Immediate resistance: $2,903 (50-period EMA) and $2,906
Breakout targets: $2,930, followed by $2,942
Support zone: $2,879, with further downside risks at $2,863 and $2,845
A decisive move above $2,906 could open the door for a rally toward $2,930 and beyond, while failure to hold $2,879 could trigger a correction toward $2,845.
Will CPI Data Spark a Breakout?
Investors are now eyeing the upcoming U.S. CPI report, which is expected to show whether inflation pressures persist. Higher-than-expected inflation could reinforce gold’s appeal as an inflation hedge, while a cooling CPI reading might weaken demand.
For now, gold’s trajectory remains tied to macroeconomic forces. If rate cut bets strengthen, gold could finally break above its four-week range. Otherwise, the metal risks further downside as uncertainty lingers.
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