Investment Manager Reveals: Gold Set for Sharp Reversal Amid Economic Uncertainty
After analyzing various time charts, it is evident that gold is on the brink of a significant turnaround. Investors are shifting their focus from gold to other safe havens due to the uncertainty surrounding gold’s price movements. Despite the weakening US dollar against Asian currencies, concerns about stagflation resulting from escalating trade-related costs are causing this shift.
The current policy dilemma faced by the US is a result of President Donald Trump’s implementation of new tariffs. These tariffs have increased the risk of slow economic growth and rising inflation, making it challenging to make further policy decisions.
In this volatile environment, I predict that gold futures will experience a sharp reversal even before the Federal Reserve announces its decision on interest rates. The current bearish pressure indicated by gold futures suggests a potential downturn in prices.
In the daily chart, gold futures are struggling to break through resistance at $3395, despite maintaining an uptrend since May 1, 2025. A breakdown below the immediate support at $3312 could trigger a selling spree. Conversely, a breakout above $3395 could attract more sellers, with a short-term target of $3212.
In the weekly chart, gold futures are facing challenges in staying above the resistance at $3372. A failure to hold above this level could lead to a selling spree, confirming bearish sentiment. If gold closes below $3210, it could further confirm the downward trend. On the other hand, a move above $3372 could test the $3477 level, but a breakthrough of $3434 may attract more bearish activity.
Overall, the outlook for gold remains bearish, with recessionary fears likely to limit any upside potential. Investors are advised to proceed with caution when considering gold positions, as the current analysis is based on observations and market trends.
In conclusion, the economic uncertainty and policy decisions are impacting gold prices, creating opportunities for investors to capitalize on potential reversals in the market. Stay informed and make prudent investment decisions in this volatile environment.