empty
06.02.2025 11:41 AM
Gold Surges: Are New All-Time Highs Within Reach?

Gold prices have skyrocketed to record highs as fears over potential U.S. tariffs on all imports, including precious metals, drive a liquidity shift from London to New York. Since the U.S. presidential election in November, gold reserves on COMEX have jumped by 88%, while demand for bars stored at the Bank of England has surged. At the same time, a weakening U.S. dollar is adding fuel to gold's rally.The imbalance in gold supply between the U.S. and the UK has led to disruptions in the market, pushing up borrowing costs for the metal. One-month gold lease rates have surged to approximately 4.7%, significantly higher than their near-zero levels over the past four years.

This image is no longer relevant

The gold rush has become a new bullish driver for XAU/USD, although the World Gold Council (WGC) acknowledges that the old drivers remain intact. In 2024, central banks purchased 1,045 tons of gold worth $96 billion. While they have been net buyers for 15 years, their buying activity doubled after the start of the Ukraine conflict, fueled by de-dollarization and reserve diversification efforts.

According to the WGC, central bank demand will remain strong in 2025, joined by investors in specialized exchange-traded funds (ETFs), further supporting price growth. Global gold demand increased by 1% to 4,974 tons last year.

This image is no longer relevant

The weakening U.S. dollar is also boosting XAU/USD, a phenomenon that has been dubbed the "help rally" for other currencies in the Forex market. The key reason is Donald Trump's decision to delay tariffs on Mexico and Canada until March 1. The USD index initially surged when the tariffs were announced but later retreated following negotiations between Washington, Ottawa, and Mexico City. Since gold is priced in U.S. dollars, a weaker USD often acts as a catalyst for gold price surges.

This image is no longer relevant

Rising geopolitical tensions are playing a crucial role in gold's upward movement. Donald Trump's plans to deploy U.S. troops to Gaza, relocate Palestinians, and clear unexploded ordnance have triggered concern among Middle Eastern nations, increasing safe-haven demand for gold. Notably, Trump has previously floated controversial geopolitical ideas, such as annexing Greenland and making Canada the 51st U.S. state.

On the daily chart, gold is showing signs of an inside bar formation, indicating market uncertainty. The previous inside bar breakout provided an opportunity for long positions at $2,677 per ounce. Given the current momentum, holding these positions and adding on pullbacks remains a viable strategy.

Key Price Targets:

  • $2,910
  • $2,960

With strong fundamentals and technical signals aligned, gold's rally remains well-supported, increasing the likelihood of new all-time highs in the near future.

Marek Petkovich,
Analytical expert of InstaForex
© 2007-2025
Select timeframe
5
min
15
min
30
min
1
hour
4
hours
1
day
1
week
Earn on cryptocurrency rate changes with InstaForex
Download MetaTrader 4 and open your first trade
  • Grand Choice
    Contest by
    InstaForex
    InstaForex always strives to help you
    fulfill your biggest dreams.
    JOIN CONTEST

Recommended Stories

Wall Street keeps White House in line

The market is showing heightened sensitivity to any good news, but its best days are behind it. The value of US equities as a percentage of the MSCI All Country

Marek Petkovich 11:42 2025-04-24 UTC+2

USD/JPY. Analysis and Forecast

The Japanese yen maintains a bullish tone despite certain headwinds and remains in focus as renewed global risk aversion fuels demand for safe-haven assets. Diminishing hopes for a swift resolution

Irina Yanina 11:35 2025-04-24 UTC+2

XAU/USD. Analysis and Forecast

Gold is showing positive momentum as it attempts to hold above the $3300 level, indicating growing investor interest in this traditional safe-haven asset. The uncertainty surrounding U.S.-China trade relations—highlighted

Irina Yanina 11:33 2025-04-24 UTC+2

Trump Is Playing a Game Where Everyone Loses

According to a senior official at the European Central Bank, President Donald Trump has drawn the entire world into a game where everyone ends up losing — referring

Jakub Novak 11:21 2025-04-24 UTC+2

Trump Desperately Needs a Deal with China

The U.S. dollar surged sharply against most major currencies after President Donald Trump stated that he plans to be very "courteous" with China in any trade talks and that tariffs

Jakub Novak 11:16 2025-04-24 UTC+2

The Fed Needs More Time to Assess the Situation

While Donald Trump is attempting to reach an understanding with China, Federal Reserve Governor Adriana Kugler stated that the current tariff policy is likely to exert upward pressure on prices

Jakub Novak 10:05 2025-04-24 UTC+2

Powell Can Sleep Soundly

Markets responded with gains, and the US dollar strengthened against the euro and other risk assets after US President Donald Trump said he had no intention of firing Federal Reserve

Jakub Novak 09:59 2025-04-24 UTC+2

The Markets Have Likely Already Passed the Bottom of Their Decline (there is a chance of continued decline in EUR/USD and GBP/USD)

While markets remain focused on trade wars, particularly between the U.S. and China, incoming economic data indicate persistent structural problems in the advanced economies of Europe and the United States

Pati Gani 09:38 2025-04-24 UTC+2

What to Pay Attention to on April 24? A Breakdown of Fundamental Events for Beginners

Few macroeconomic events are scheduled for Thursday, but yesterday's developments showed that the market continues to ignore the majority of data releases. Only a handful of reports are lucky enough

Paolo Greco 06:05 2025-04-24 UTC+2

GBP/USD Overview – April 24: Didn't work out? So be it...

On Wednesday, the GBP/USD currency pair managed to avoid a substantial decline, although the day before, it seemed that a downtrend was finally beginning. However, the market quickly bounced back

Paolo Greco 03:16 2025-04-24 UTC+2
Can't speak right now?
Ask your question in the chat.
Widget callback
 

Dear visitor,

Your IP address shows that you are currently located in the USA. If you are a resident of the United States, you are prohibited from using the services of InstaFintech Group including online trading, online transfers, deposit/withdrawal of funds, etc.

If you think you are seeing this message by mistake and your location is not the US, kindly proceed to the website. Otherwise, you must leave the website in order to comply with government restrictions.

Why does your IP address show your location as the USA?

  • - you are using a VPN provided by a hosting company based in the United States;
  • - your IP does not have proper WHOIS records;
  • - an error occurred in the WHOIS geolocation database.

Please confirm whether you are a US resident or not by clicking the relevant button below. If you choose the wrong option, being a US resident, you will not be able to open an account with InstaForex anyway.

We are sorry for any inconvenience caused by this message.