Gold Falls 2% After Record High as Tariff Shock Reprices Market Risks

Gold prices dipped on Friday, retreating from a record high of $3,167.57 reached earlier in the week, as investors reassessed global risk following.

U.S. President Donald Trump’s sweeping tariff announcement. Bullion slid over 2% in Thursday’s session, erasing gains driven by geopolitical anxiety and uncertainty.

Trump’s proposal includes a 10% blanket tariff on all imports and additional levies targeting key trading partners, triggering fears of an inflationary trade war. These aggressive measures shifted market sentiment and caused a broad asset sell-off, including in traditionally defensive plays like gold.

“Gold tends to rally amid unquantifiable risk, but that premium fades once markets can assign value to the threat,” explained Ilya Spivak, Head of Global Macro at Tastylive. “The administration has picked a direction. While sentiment isn’t optimistic, the uncertainty premium in gold is thinning.”

While gold typically thrives in uncertainty, clearer policy direction—even if unfavorable—can dull demand as traders recalibrate their risk outlooks.

Investors Brace for Jobs Data, Fed Response

Market participants now await the U.S. non-farm payrolls report due next week. The data could significantly impact expectations around Federal Reserve policy, especially amid tightening financial conditions triggered by trade-related volatility.

Federal Reserve officials have remained cautious, awaiting details of Trump’s tariff strategy. Analysts suggest that this latest move could accelerate inflationary pressures, challenging the Fed’s balancing act between price stability and growth.

What to watch next:

• U.S. Non-farm payrolls for labor market signals

• Fed commentary on trade-induced inflation risks

• Potential retaliatory tariffs from key U.S. trading partners

The next phase of gold’s price trajectory will likely be shaped by how central banks respond to the evolving trade landscape and its impact on macroeconomic stability.

Gold Technical Outlook: Support Holds for Now

Gold (XAU/USD) is trading at $3,103, recovering from a recent pullback that briefly tested the lower boundary of its ascending price channel. The metal found solid support at $3,088 near its 50-period EMA, where dip buyers re-entered the market.

Despite the correction, bullish structure remains intact as long as gold holds above $3,054. Key resistance lies at $3,135, followed by $3,167—a retest of the recent peak. On the downside, a break below $3,088 could expose the $3,054 and $3,033 zones.

Key technical levels:

• Support: $3,088, $3,054, $3,033

• Resistance: $3,135, $3,167

• RSI: 56.22, indicating neutral momentum

With gold still trading within a rising channel, the broader trend favors further upside—but only if macro headwinds don’t intensify.