Gold Smashes Record High as Bulls Eye $3,100 Amid Trade War Fear
Balogun Opeyemi
2025-03-31Gold remains bullish after repeatedly testing the record high of $3,086. A breakout above this level could pave the way for a move toward $3,100, with further upside targets at $3,150 and $3,200.
Gold (XAU/USD) soared to an all-time high of $3,086 on Friday, closing at $3,079 (+0.79%), as escalating trade tensions and expectations of Federal Reserve rate cuts fueled safe-haven demand. With market uncertainty rising, bulls are now setting their sights on the $3,100 level.
Fundamental Analysis:
U.S. Trade Tariffs Ignite Global Uncertainty
Investor sentiment has turned cautious ahead of April 2, a date President Donald Trump has declared “Liberation Day” following his executive order imposing 25% tariffs on all imported cars. The move has already triggered strong backlash, with Canada and the EU preparing retaliatory measures, heightening fears of a renewed global trade war.
Dollar Weakness and Flight to Safety
The U.S. Dollar Index (DXY) closed the week down 0.11%, reflecting the pressure on the greenback. Investors are moving into safe-haven assets like gold and the Japanese yen (JPY) while U.S. Treasury yields continue to decline.
Fed Rate Cut Bets Gain Momentum
The Core Personal Consumption Expenditures (PCE) Price Index, the Fed’s preferred inflation gauge, came in as expected, reinforcing speculation of two rate cuts in 2025.
However, the University of Michigan Consumer Sentiment Index showed a steeper-than-expected decline, signaling weakening consumer confidence.
San Francisco Fed President Mary Daly emphasized that inflation progress has stalled but remains committed to gradual easing if conditions allow.
What This Means for Gold
With trade war concerns escalating, the dollar struggling, and rate cut bets strengthening, gold’s bullish momentum remains intact. Investors are closely monitoring potential retaliatory actions from global economies, which could further drive safe-haven inflows.
XAU/USD Technical Outlook: Bulls Target $3,100
Gold remains bullish after repeatedly testing the record high of $3,086. A breakout above this level could pave the way for a move toward $3,100, with further upside targets at $3,150 and $3,200.
On the downside, initial support lies at $3,057. A sustained break below this level could trigger a pullback to $3,025, where the 72 EMA (4-hour chart) provides additional support. A deeper decline could bring XAU/USD into the key $3,000 demand zone.
