Fundamental Analysis:

Gold hit a new record high as investors grew increasingly concerned over the deepening U.S.-China trade war. Tensions escalated after President Trump imposed a 145% tariff on Chinese goods, with exemptions for smartphones. In response, China announced 125% tariffs on U.S. products. The White House further noted that combined tariffs on some Chinese goods could surge to 245%. Meanwhile, Fed Chair Jerome Powell warned that tariffs could trigger inflation, and despite signs of stagflation, emphasized that rate cuts might worsen the economic outlook. These conflicting signals continue to drive safe-haven flows into gold.

Technical Breakout:  

Gold prices are trading higher after breaking above the previous resistance level. If bullish momentum continues, prices could re-test the next resistance at 3380.00 and potentially 3490.00. However, MACD signals fading bullish momentum, while RSI stands at 81, entering overbought territory. A slowdown in buying pressure could lead to a pullback toward the support at 3290.00.

Potential Risks: The ongoing U.S.-China trade war remains the primary risk factor

Monitoring: Investors are advised to continue monitoring trade development between US and the world to gauge the likelihood movement for the asset classes.

Resistance levels: 3380.00, 3490.00

Support levels: 3290.00, 3220.00

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