Gold Eyes $3,250 as Tariff War Heats Up: 3 Reasons Why It’s Rallying

Gold is back in the spotlight with prices heading towards $3,250 as President Trump’s global tariffs spook markets and send safe-haven demand soaring.

The latest round of tariffs includes a whopping 145% on Chinese imports and 10% on dozens of other countries – and it’s got everyone rattled.

But this time it’s not just market volatility driving the gold rush. What’s different is the growing skepticism towards traditional safe-haven assets like US Treasuries and the dollar. As Washington’s policies become more unpredictable, investors are turning to gold as a hedge – not just against inflation but against systemic risk.

Goldman Sachs just revised its 2025 forecast to $3,700 citing a weaker dollar, persistent inflation and global shift away from US debt.

China Buys Big, India Pulls Back

Gold demand is getting a big boost from Chinese buyers even as India – the world’s biggest consumer – takes a break.

In China the spot premium in Shanghai hit $39/oz on April 11 – its highest since 2016. This is heavy buying from both retail and institutional investors driven by the stock market and a weakening yuan.

India’s gold demand has softened. Record high prices in March saw dealers offering discounts as deep as $41/oz – the deepest in eight years. Those discounts have since narrowed to $11/oz but Indian consumers are still cautious.

What’s driving gold demand right now:

• Investors hedging against erratic economic policies

• Central banks shifting reserves away from the US

• Strong Chinese demand as India retrenches

Overall global demand is solid – led by safe-haven buyers and institutional flows.

Gold Technical Outlook: Bulls Target $3,299 Next

From a technical perspective gold (XAU/USD) is on a roll. After bouncing off the $3,087 support – the 61.8% Fibonacci retracement – prices are now knocking on the door of $3,256 – a key resistance zone aligned with the 1.414 Fibonacci extension.

RSI is at 70.7 – strong momentum but hinting the rally may be getting overbought.

Trade Setup to Watch:

• Entry: Wait for a breakout and confirmed retest above $3,256

• Upside targets: $3,299 and $3,343

• Support: $3,168 and $3,132

• Risk: Pullback to 50-EMA at $3,114

For newbies this is a breakout trade – but only with confirmation and tight risk management. Use stop-losses below nearby support to manage downside risk.

Conclusion

With global chaos and faith in fiat systems crumbling, gold is back on top. Whether you’re a long term investor or short term trader, this may be a trade worth watching – especially if it closes above $3,256.