Gold Stabilizes After Ceasefire News
Gold (XAU/USD) stabilizes in the $2,620s on Tuesday after sliding almost three percent – a whopping $90 plus – on Monday due to rumors Israel and Hezbollah were on the verge of agreeing on a ceasefire. This news improved the outlook for geopolitical risk, reducing safe-haven flows to the precious metal.
Israel War Cabinet Meeting
The Israeli war cabinet meets on Tuesday to discuss the 60-day deal, while Trump issues tariff threats to neighbors and China.
Gold’s Sell-Off Stalls
Gold weakens slightly but then recovers on Tuesday after President-elect Donald Trump threatens to impose 25% trade tariffs on Mexico and Canada, and an extra 10% to the already 60% announced in his election campaign on China. This led to a stronger US Dollar (USD), negatively impacting Gold initially.
Gold Falls Amid Ceasefire Rumors
Gold fell almost three percentage points on Monday during the US session after rumors began emerging that Israel and Hezbollah were inches away from closing a ceasefire deal in Lebanon. The ceasefire would not cover the conflict in Gaza. The trend is still bullish on a medium and long-term basis.
Technical Analysis: XAU/USD Pulls Back
Gold sliced through its 50-day Simple Moving Average and fell to a major trendline at around $2,630. A Bearish Engulfing candlestick pattern formed on Monday, indicating a potential short-term reversal, but the long-term trend remains bullish.
XAU/USD Daily Chart
US Dollar FAQs
The US Dollar (USD) is the official currency of the United States of America and a significant number of other countries. It is the most heavily traded currency in the world, accounting for over 88% of all global foreign exchange turnover. The value of the USD is impacted by monetary policy, which is shaped by the Federal Reserve (Fed).