Gold: a new ATH led by tariffs

The previous week was everything but boring on financial markets. The equities were shaken by Chinese AI company DeepSeek, the Fed kept interest rates unchanged, the new US President noted in a speech in Davos that interest rates should go down immediately, while at the end of the week, the US Administration imposed import tariffs to goods coming from Canada, Mexico and China. The past week was a game changer for international trade, bringing back the uncertainty to financial markets. As the markets never liked uncertainty, the price of gold was pushed to the fresh, new all time highest level at $2.815.

As the price of gold reached its new highest levels, the RSI was pushed to the level of clear overbought market side. In the “normal” situation this would be an indication of a potential reversal in the coming period. The moving average of 50 days started again to diverge from MA200. Certainly, for the time being, there will be no cross between these two lines.

As previously explained, markets have never been happy to deal with uncertainty. Although the RSI is pointing to a potential short term reversal in the coming period, this might not be the actual case at this moment. A market driven by uncertainty, will continue to buy gold in order to hedge the “uncertain” moment. The next week will show us the current market sentiment. As per current charts, the price of gold might modestly revert to the downside, but not below the $2.770. On the opposite side, the path is open.