Gold Price Rallies on Russia-Ukraine Conflict: Will Gold Set New Records by 2025?
The recent bullish rally in gold has been fueled by concerns over the Russia-Ukraine conflict, stirring safe haven demand. Market sentiment is torn between the prospect of fewer Fed rate cuts in 2025 and rising geopolitical risks. Goldman Sachs analysts predict gold will set new records by the end of 2025, further bolstering bullish sentiment.
Gold bulls came out strong this week as heightened geopolitical tensions in Europe dominated the news. The safe-haven appeal of precious metals returned following reports that the US authorized Ukraine to use ATACMS missiles to strike in Russian territory.
The precious metal has also benefited from a weaker dollar to start the week. However, gold is currently caught between conflicting forces. Markets are betting on fewer rate cuts in 2025 from the Federal Reserve, supporting the USD. On the other hand, heightened geopolitical risks around Russia-Ukraine and the Middle East are keeping gold buyers interested.
Looking back at history, gold prices rose significantly during President Trump’s first term in office due to trade wars and tensions with Iran and North Korea. With similar tensions rising currently, the potential for a US-China trade war could further boost gold prices.
Goldman Sachs analysts predict that gold will set a new record by the end of 2025, indicating a positive outlook for the precious metal in the long term.
In terms of technical analysis, gold has shown resilience despite a bearish momentum. The recent rally has brought the precious metal closer to key resistance levels, indicating a potential upside. Immediate resistance levels are at 2639 and 2650, with support levels at 2624 and 2600.
Overall, the current geopolitical landscape and market sentiment suggest that gold may continue its upward trajectory, potentially reaching new all-time highs. Investors should keep a close watch on economic data releases and geopolitical developments to make informed decisions regarding their gold investments.