Gold fell sharply overnight and dropped below $3,300 in early European trade. It has now given back most of its gains from Friday, when it rallied sharply on news that President Trump was hitting the EU with a fresh 50% tariff. Gold’s pullback comes as the Trump administration postponed those tariffs for five weeks.
Further downside pressure is coming from this morning’s bounce in the US dollar. The Dollar Index had dropped steadily over the past fortnight. But it found a bid this morning, making gains across the board in early trade. Despite this, overall dollar weakness, along with market uncertainty, has kept gold on traders’ radars as a preferred defensive asset.
Looking at the daily chart, the 50-day moving average has acted as support since the beginning of this year. The 50-day is currently around $3,200, so it should be worth keeping this area in mind if gold were to pull back further.
Source: TradingView
Silver was also out of favour this morning. Yet again, $33 is proving to be a magnet for the silver price as traders test it out as support.
