Gold Hits 2-Week High, Spotlight on Trump’s Policies

Let’s take a look at the extremely bullish pattern forming on the gold chart. Gold prices have just rallied to their highest level in more than two weeks, driven by strong safe-haven demand amid persistent geopolitical concerns and anticipation of President-elect Donald Trump’s incoming trade tariffs. Investors and traders also positioned themselves ahead of key U.S. economic data releases, namely the FOMC meeting minutes.

To recap, gold soared over 27% in 2024, marking its biggest annual gain since 2010. This came regardless of high interest rates. 

The recent rise appears to be a 'buy the dip' moment, as no major fundamental announcements were made, but the price rallied. The environment of uncertainty surrounding geopolitical tensions seemed to have continued to underpin gold’s appeal.

Reports of a Russian drone strike on Kyiv on Wednesday, coupled with military action by Israel in a suburb of Gaza City, contributed to a more cautious market sentiment. Traders also kept a close watch on scheduled U.S. job openings data, the ADP employment report, the Fed’s upcoming minutes release, and the comprehensive U.S. employment report. All these releases could influence the path of interest rates in 2025.

In 2024, a combination of rate cuts (although not dramatic), robust central bank buying, and geopolitical frictions helped propel gold to record highs. These factors resulted in its notable 27% annual increase. Some market analysts believe any early-year price corrections or consolidations might set the stage for a renewed rally, with a gold-price target around $3,000 per ounce considered achievable and conservative, while more dramatic predictions call for gold to reach $10,000 per ounce.

President-elect Trump’s impending inauguration on January 20 has heightened market nerves. His proposed tariffs and protectionist stance are viewed as potentially inflationary and could trigger trade disputes. If these policies dampen the U.S. dollar’s strength, gold might benefit even further making investors less hung-up on only interest rates. With his recent repeated calls to make Canada and Greenland part of the USA, analysts may be refreshing their memories with how forward and aggressive his economic policies can be as well. This fear of the unknown will likely continue to be a factor in gold’s movement.

See the below weekly timeframe chart to see an extremely bullish formation playing out:

Although currently down slightly, the weekly chart (one of the largest, most powerful timeframes) is forming a ‘bullish symmetrical triangle’. This indicates a potential aggressive rise in the gold price and is typically a much stronger pattern than a ‘bull flag’. Time may be running very short for the current suppressed price to remain where it is.