Gold prices remained stable early Tuesday, hovering near a two-week high at $3,387.
Investors appear cautious ahead of the Federal Reserve’s policy announcement, while lingering global risks support demand for safe-haven assets. “Gold is holding firm as a hedge against economic and geopolitical uncertainty,” said a commodities strategist at ING.
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Silver also benefits from the risk-off tone, trading at $33.10 after reaching a session high of $33.12. The metal continues to mirror gold’s price trajectory, supported by technical strength and safe-haven flows. Economic data from the U.S. has shown improvement.
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The Institute for Supply Management reported its services PMI rose to 51.6 in April, up from 50.8 in March, indicating steady expansion. Meanwhile, last week’s employment report revealed stronger-than-expected job growth, adding to optimism around the U.S. economy. While the data points support growth, uncertainty around inflation and the Fed’s next steps keeps investors defensive,” said a senior economist at Capital Economics.
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Fed policy anticipation influences gold prices
Attention now shifts to the Federal Open Market Committee meeting. While no rate change is expected, investors will scrutinize Fed Chair Jerome Powell’s tone for signals on potential rate cuts later this year.
Gold is trading around $3,362 after piercing above a significant resistance zone near $3,351. Price action has rallied sharply off the $3,202 low, reclaiming the 50-period EMA at $3,290 along the way, and is now testing a longer-term descending trendline. Silver is trading near $32.98 on the 2-hour chart, below the descending trendline resistance from late April highs.
The recent rally brought silver into a tight wedge, with upward momentum tested by overhead resistance near $33.20. The price of gold saw a significant increase on Monday as investors sought safe-haven assets with the Federal Open Market Committee meeting commencing. A seasoned financial journalist, Jim Wyckoff, noted the trend in his daily technical analysis.
Gold advanced amid ongoing trade war risks following US President Donald Trump’s latest tariff comments, while investors await a Federal Reserve interest-rate decision later this week. Gold has surged 26% this year, hitting a record above $3,500 an ounce in April before losing some ground in the last couple of weeks.
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