April 22, 2025 – DailyForex.pk
Gold prices (XAU/USD) continued their historic climb on Monday, printing a new record high above $3,380 during the Asian session. The metal now trades within striking distance of the psychological $3,400 level, driven by growing concerns over US tariff escalation, Federal Reserve independence, and a weakening US dollar.
Despite a brief pullback ahead of the Easter weekend, bullish momentum returned strongly, supported by elevated safe-haven flows and fresh political risk.
📊 XAU/USD Technical Outlook: Bulls Eye $3,400 Breakout
At the time of writing, XAU/USD trades around $3,383.83, with the 14-day Relative Strength Index (RSI) hovering at 75.50, signaling an overbought market. Still, gold buyers show no signs of retreat.
Key Levels to Watch:
- Immediate Resistance: $3,400 – A daily close above this level could extend gains toward $3,450
- Near-term Support: $3,329 (session low) → followed by $3,300 round number
- Deeper Correction Levels: $3,284 (Friday’s low) if selling pressure intensifies
Despite stretched technicals, gold remains well-supported, and any dips are likely to be viewed as buying opportunities unless the $3,284 level breaks decisively.
🧠 Fundamental Drivers: Trade War Escalation, Fed Uncertainty, Weak USD
Gold’s explosive rally is fueled by a combination of risk-off catalysts:
- US-China Trade War Escalation:
Over the weekend, tensions flared after a Boeing jet meant for a Chinese airline was returned to the US, signaling China’s retaliation against Washington’s aggressive trade stance.
This follows Trump’s directive to launch a national security probe into critical mineral imports from China—potentially leading to broad new tariffs. - Fed Independence at Risk:
Reuters reported that Trump is still considering removing Fed Chair Jerome Powell, as per White House adviser Kevin Hassett, raising fears about the central bank’s independence and its role in maintaining market stability. - US Dollar at 3-Year Low:
Amid political and economic uncertainty, the US Dollar Index (DXY) has plunged to multi-year lows, further boosting gold demand as investors seek safer assets.
📉 What’s Ahead for Gold This Week?
While the week kicks off with light US economic data, gold traders will stay focused on:
- Tariff announcements or developments from the Trump administration
- Fedspeak – Any commentary hinting at monetary policy changes
- Market sentiment shifts in response to global risk headlines
- S&P Global US flash PMI data later in the week
With thin liquidity due to Easter Monday holidays in global markets, volatility could spike, making gold’s movement sensitive to even minor headlines.
📌 Conclusion: Gold Rally Extends as Safe-Haven Flows Dominate Market Sentiment
As XAU/USD edges closer to $3,400, investors continue piling into gold amid deepening geopolitical risks, tariff-related concerns, and questions around Fed leadership. While technically overbought, gold remains fundamentally supported, and bullish sentiment prevails.
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