On Monday, the Gold prices rose to their highest in more than two months upon concerns that U.S.-Chinese trade stresses and Washington’s warning of tariffs on Mexico would harm the global economy. The precious metal surged by 0.7% to trade at $1,314.20 per ounce, after testing its highest since March 27 at $1,315.59.
The Safe-haven investors are getting back to precious metal again, due to tariff-talks, which is encouraging for the metal. Therefore, Gold has also sailed pretty seamlessly over essential levels, such as $1,293 and $1,300. The U.S.-Chinese relationships slipped further downhill while the two nations fought at the Shangri-La Dialogue in Singapore over security disputes across Taiwan and the South China Sea.
Besides that, Trump government announced on Thursday it will impose a 5% tariff on all imported goods from Mexico start June 10 and slowly increase that tax 25% until the issue of illegal migrants across the border stops. The news conveyed the haven metal higher. It was also heightened due to more China-U.S. trade war jitters.
Gold Technical Outlook
Now that gold prices have traded over 1,288.58, we are a topside break of the sideways as well as the downtrend from the February and March 2019 highs. To this end, while the forecast has shifted in a bullish direction, gold prices now need to clear 1,303.21, the May high, in order to cement their bullish breakout move.
Ultimately, if gold prices have been consolidating in a bullish falling wedge since January, then the terminal price target would be for a return to 2019 high at 1,346.61.
On Gold, the market recently broke and closed above 1,300 key resistance level. I anticipate seeing a pullback to broken resistance that now became support and further bullish continuation to 1,319.0