President Trump’s clarification that gold imports will not face tariffs has pulled the rug out from under last week’s bullion rally.
Gold had risen on fears of higher import costs, but with that risk now off the table, prices have already started to ease as the shiny commodity drops 1.62% on the day.
Don’t Ignore These
Trump’s tariff decision only removes one risk factor. The market’s still juggling:
Sticky inflation numbers in the US.
Rate cut speculation for September.
Ongoing geopolitical uncertainty (Russia, China, tariffs on other sectors).
A USD that’s been swinging wildly on rate expectations.
If rate cuts really are coming as the market is pricing, that’s bullish gold long-term, but we’re still weeks away from the next Fed decision. That means plenty of room for this choppy range bound price action to continue in the short term.
What I’m Watching
The range plays could be pretty good here for me, technically I would say gold is still bullish despite the hedge funds removing long positions here for a while.
Here’s what I like:
Short term longs from range lows - this could be the play if we experience swings in the US data releases. Support currently can be seen at $3,258.00. Around these lows could see sellers leave and buyers step back in.
A breakout either way - alternatively the market may be heading for a breakout. A break of the support mentioned above would be bearish, which could lead to a sharp move lower. However a break into new highs could form if the USD sinks further. This move may be a slow burner.