Gold (XAU/USD) hit another record high on Tuesday, breaching the psychological $4,700 mark as rising geopolitical tensions fuel sturdy safe-haven demand. At the time of writing, XAU/USD is trading around $4,720, holding just below a fresh all-time high near $4,737.
Market sentiment remains uncertain as trade tensions between the US and the European Union (EU) dominate headlines. Over the weekend, US President Donald Trump threatened to impose modern tariffs on eight European countries over the Greenland issue.
European leaders sharply criticized the move and warned that countermeasures were being prepared in the event of tariffs being introduced.
These events have revived fears of a wider transatlantic trade war. The risk-off sentiment is weighing on global equities and increasing demand for defensive assets.
Trump’s increasingly protectionist stance is also undermining confidence in US assets, putting pressure on the US dollar (USD) and prompting investors to shift to G10 alternative currencies and time-honored sheltered havens such as gold.
In addition to trade concerns, the ongoing Russia-Ukraine war and lingering tensions in the Middle East continue to enhance geopolitical risks. At the same time, sturdy institutional and investment demand combined with dovish expectations from the Federal Reserve (Fed) remain key factors underpinning the metal’s broader uptrend.
Market Insiders: Trade Tensions, Court Rulings and Fed Leadership Risks Emerge
- The U.S. Dollar Index (DXY), which tracks the value of the dollar against a basket of six major currencies, continued its decline for a second straight day, settling around 98.38, near a two-week low.
- US President Donald Trump, in an interview with NBC News, did not rule out the apply of military force to take control of Greenland, replying: “No comment.” Separately, Trump wrote on Truth Social that Greenland is “an imperative for national and global security. There is no going back – that’s what everyone agrees on!” after a conversation with NATO Secretary General Mark Rutte and added that this issue will also be discussed at the World Economic Forum in Davos.
- EU foreign policy chief Kaja Kallas said Europe was “not interested in picking a fight” with the United States but “will maintain our position” and has “a set of tools to protect its interests.” Analysts say that if trade tensions with Washington escalate, the euro zone could apply its huge holdings of American assets as leverage. The eurozone is the largest foreign holder of long-term US Treasuries, with about 21% of all foreign holdings.
- Markets are also bracing for major risk events this week, including a U.S. Supreme Court ruling on the legality of President Trump’s tariffs, Wednesday’s litigation over Trump’s attempt to oust Fed Governor Lisa Cook over mortgage fraud allegations, and the potential announcement of a modern Fed chairman.
- Attention is also focused on upcoming U.S. macroeconomic data, including delayed personal consumption expenditure (PCE) inflation data and third-quarter gross domestic product (GDP) data released on Thursday. On Friday, the focus will be on preliminary S&P Global Purchasing Managers’ Index (PMI) research and consumer sentiment data from the University of Michigan.
Technical Analysis: XAU/USD Estimated at $4,800 While Support Nears $4,700
From a technical perspective, XAU/USD continues to move deeper into uncharted territory with a sturdy uptrend. On the 4-hour chart, gold is moving within a well-defined ascending parallel channel and holding above key moving averages, reinforcing the broader bullish sentiment.
On the other hand, the $4,700 area currently represents the first major short-term turning point. Failure to stay above this zone could open the door to a correction towards $4,650 and then $4,600. Deeper support is seen near the 100-period SMA near $4,505.
On the other hand, bulls may look to extend the rally towards the $4,750 region, with the next psychological target emerging near $4,800.
Dynamics indicators remain supportive. The relative strength index (RSI) remains in overbought territory near 70, reflecting sturdy upward pressure. Meanwhile, the average directional index (ADX) near 29 suggests that the broader uptrend remains intact.
Today’s US dollar price
The table below shows the current percentage change of the United States Dollar (USD) against the major listed currencies. The US dollar was strongest against the British pound.
| USD | EUR | GBP | JPY | BOOR | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.80% | -0.17% | -0.21% | -0.30% | -0.22% | -0.67% | -0.98% | |
| EUR | 0.80% | 0.64% | 0.61% | 0.51% | 0.59% | 0.13% | -0.18% | |
| GBP | 0.17% | -0.64% | 0.00% | -0.12% | -0.05% | -0.50% | -0.81% | |
| JPY | 0.21% | -0.61% | 0.00% | -0.12% | -0.04% | -0.50% | -0.80% | |
| BOOR | 0.30% | -0.51% | 0.12% | 0.12% | 0.08% | -0.38% | -0.68% | |
| AUD | 0.22% | -0.59% | 0.05% | 0.04% | -0.08% | -0.45% | -0.74% | |
| NZD | 0.67% | -0.13% | 0.50% | 0.50% | 0.38% | 0.45% | -0.31% | |
| CHF | 0.98% | 0.18% | 0.81% | 0.80% | 0.68% | 0.74% | 0.31% |
The heat map shows the percentage changes of the major currencies relative to each other. The base currency is selected from the left column and the quote currency from the top row. For example, if you select the US dollar from the left column and move along the horizontal line to the Japanese yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).
