12 Feb 2025

Possible Trade Scenarios:

1. Bullish Scenario (Breakout)

   • If gold breaks above the descending trendline (~2,900), it could move towards 2,915–2,920 as the next target.
   • A further push above 2,920 might see a retest of 2,940–2,950.

2. Bearish Scenario (Breakdown)

   • If gold fails to hold 2,884 support, we could see a drop towards 2,870–2,860.
   • A break below 2,860 would indicate stronger bearish momentum, possibly targeting 2,850–2,840.

Key Levels to Watch:

• Immediate Resistance: 2,900 (Descending trendline)
• Stronger Resistance: 2,915–2,920
• Immediate Support: 2,884–2,888
• Stronger Support: 2,870–2,860

Conclusion:

• If price breaks above 2,900, a bullish move is likely.
• If price fails and drops below 2,884, expect more downside.

Gold prices have drawn the attention of sellers for the second consecutive day, influenced by a slight increase in the value of the USD.

The recent assertive comments made by Fed Chair Powell have bolstered demand for the dollar.

Additionally, concerns regarding trade wars are likely to mitigate any potential decline in the safe-haven XAU/USD pair.

Gold prices (XAU/USD) continue to exhibit a bearish sentiment during the initial half of the European trading session on Wednesday. However, there is a noticeable absence of significant selling pressure as market participants await the upcoming release of US consumer inflation data. Concurrently, the US Dollar (USD) is experiencing a slight uptick in demand following hawkish comments made by Federal Reserve Chair Jerome Powell on Tuesday. This, combined with an overall positive risk sentiment, has contributed to the commodity's decline for the second consecutive day.

Nevertheless, apprehensions regarding new tariffs imposed by US President Donald Trump on commodity imports, along with the potential for reciprocal tariffs and ongoing geopolitical tensions, are likely to provide support for the safe-haven appeal of Gold. Consequently, it is prudent to exercise caution before concluding that the XAU/USD has reached a peak in the short term, as well as before anticipating any substantial corrective pullback from the recent all-time high, which was approximately $2,942-2,943, reached on Tuesday amid trade war concerns.