Key Points
- Gold rises 0.6% to $5,136.22, its highest since January 30.
- Dollar weakens as US Supreme Court strikes down major Trump tariffs.
- Resistance seen near $5,400; inflation data tempers rate-cut hopes.
Gold extended gains on Monday, climbing to a three-week high as renewed uncertainty around US trade policy pressured the dollar and revived demand for defensive assets.
Spot gold rose 0.6% to $5,136.22 per ounce, after reaching its highest level since January 30. US gold futures for April delivery advanced 1.5% to $5,157.50, reflecting stronger conviction in safe-haven positioning.
The move followed a landmark ruling by the US Supreme Court striking down sweeping tariffs previously imposed under emergency powers.
The decision injected fresh uncertainty into global markets and weighed on the greenback, helping bullion extend its recovery.
In response, President Donald Trump signalled plans to raise a temporary tariff from 10% to 15% on imports from all countries, adding further ambiguity to the trade outlook.
Wall Street futures and the dollar slipped in Asian trading, reviving elements of the “sell America” narrative that tends to benefit gold.
Tariff Twists and Inflation Add Complexity
While tariff uncertainty supports safe-haven demand, macro data complicates the rate outlook. Recent US inflation figures showed underlying price pressures increased more than expected in December, with further acceleration anticipated in January.
Stronger inflation reduces the likelihood of early Federal Reserve rate cuts, limiting gold’s upside in the near term. Markets currently expect easing to begin around June.
Geopolitical risk also remains in play. Iran has signalled willingness to negotiate over its nuclear programme to avert potential US military action, which could ease tensions if progress materialises. However, uncertainty around that process continues to underpin defensive flows.
Technical Analysis
Gold (XAUUSD) is trading near 5,125, up around 0.35% on the session, and continues to consolidate beneath the recent swing high at 5,598.60.
The broader trend remains upward, but price action over the past few weeks reflects a cooling phase after the sharp late-January spike and pullback.
On the daily chart, price is holding just above the short-term moving averages, with the 5-day (5,016) and 10-day (5,014) clustered closely around current levels.
The 20-day (5,019) is also nearby, suggesting a tight compression zone that could precede a breakout. Meanwhile, the 30-day (4,933) continues to slope upward, reinforcing the underlying bullish structure as long as price remains above that level.
Immediate support sits around 5,000–5,020, followed by stronger support near 4,850–4,900, where prior consolidation formed after the post-spike correction.
On the upside, a sustained push above 5,200 would strengthen bullish momentum and bring a retest of the 5,500–5,600 highs into focus. For now, gold appears to be building a base within a broader uptrend rather than signalling a full reversal.
Cautious Outlook
Gold’s advance reflects renewed policy uncertainty and dollar weakness rather than a clear shift in the rate cycle. As long as tariff ambiguity persists and the greenback remains under pressure, bullion may continue to attract safe-haven demand.
However, upside momentum toward $5,400 will likely depend on whether inflation moderates and whether geopolitical tensions escalate or stabilise. If inflation remains firm and yields rise further, gains could stall despite trade-related uncertainty.
For now, the broader structure remains positive above $5,000, but the next directional catalyst will likely come from inflation data and developments in US trade policy.
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