On Monday, after US President Trump announced a 25% tariff on steel and aluminum products, gold prices rose to a new historical high. The surge in safe haven demand for gold has pushed the price to break through $2888 per ounce and surpass the historical high of $2886.79 per ounce set on February 9th. Trump's tariff threat has raised concerns in the market about the uncertainty of the future global economy, thereby increasing demand for safe haven assets such as gold.

Richard Franulovich, an analyst at Westpac Bank, pointed out that "Trump's policies are unpredictable and disruptive, whether it is imposing tariff threats on allies or opponents, or even threatening to impose 100% tariffs on BRICS countries, these factors have increased the risk aversion appeal of gold." Trump's threats indicate that the risks and uncertainties faced by global financial markets have significantly increased, and investors' demand for safe haven has thus increased.

The potential impact of Federal Reserve policies on gold

Investors will pay attention to Federal Reserve Chairman Powell's upcoming testimony before the US Congress to understand the future direction of the Fed's monetary policy. If the Federal Reserve maintains its current interest rate policy, this may be negative for gold as it does not pay interest. However, Powell may emphasize the resilience of the US economy, which also means that the Federal Reserve may not be in a hurry to cut interest rates, which could put some pressure on gold in the short term.

technical analysis

The current gold price is in a clear upward trend, constantly hitting new highs, with the latest price being $2889.79. Through technical analysis, the price has broken through the previous high point, showing strong upward momentum. The MACD indicator shows a sustained bullish trend, and the gap between DIFF and DEA is large, indicating that the market is still in a bullish state.

However, it should be noted that the gold price is approaching the upper boundary of the channel ($2892.15), and there is a certain risk of a pullback. If the price breaks through this level, it may continue to rise, but if it fails to break through, there may be short-term fluctuations or corrections. Investors should pay attention to the support and resistance positions of the upper and lower tracks of the channel, as well as the divergence of the MACD indicator, to determine whether there is a reversal signal. Meanwhile, if the price falls back to the lower limit of the channel (around $2783.41), it can be considered as a support level.

Trump's tariff policies have fueled risk aversion and boosted gold prices. Against the backdrop of increasing global economic uncertainty, the attractiveness of gold as a safe haven asset continues to strengthen. However, despite this, the sustained rise in gold prices may lead to some investors facing the problem of high prices. Therefore, when participating in gold investment, investors still need to carefully consider market risks.