GOLD Price Analysis – Dec 31, 2024
Daily Price Outlook
Gold prices are closing out 2024 with a remarkable 26% gain, marking the metal's best annual performance since 2010.
This surge was fueled by robust central bank buying, heightened geopolitical risks, and a wave of monetary policy easing by major central banks. Gold last touched an all-time high of $2,790.15 on October 31, driven by a series of record-breaking rallies throughout the year.
“Rising geopolitical tensions, central bank demand, and renewed inflows into gold-linked Exchange Traded Commodities (ETCs) were key drivers of the rally,” noted Aneeka Gupta, Director of Macroeconomic Research at WisdomTree.
These dynamics made gold one of the top-performing assets of 2024, even as other markets faced headwinds from inflationary pressures and economic uncertainties.
Challenges Ahead: Dollar Strength and Slower Rate Cuts
Despite its stellar run, gold faces potential challenges in 2025. A stronger U.S. dollar and a more cautious Federal Reserve could moderate the metal’s upward momentum.
The Fed’s decision to implement a third consecutive rate cut in December was tempered by a warning of fewer cuts in 2025, reflecting concerns over persistent inflation.
Additionally, the incoming Trump administration’s economic policies—focused on tariffs, deregulation, and tax reforms—are expected to introduce further volatility into global markets. Such uncertainty, however, could bolster gold’s appeal as a safe-haven asset.
“Gold could continue to thrive in 2025 if geopolitical tensions escalate under Trump’s leadership, drawing investors toward this time-tested safe haven,” said Han Tan, Chief Market Analyst at Exinity Group.
2025 Outlook: Could Gold Hit $3,000?
Analysts remain optimistic about gold’s trajectory in the coming year. Goldman Sachs commodities strategist Daan Struyven projects prices could reach $3,000 per ounce, citing sustained central bank demand and renewed interest in gold ETFs as key factors.
GOLD (XAU/USD) – Technical Analysis
Gold (XAU/USD) is trading at $2,608.34, up 0.10%, as cautious optimism dominates amid low-volume, year-end trading. The pivot point at $2,620.16 remains critical, with prices struggling to sustain upward momentum.
Immediate resistance lies at $2,638.91, with further barriers at $2,651.73 and $2,665.31. On the downside, support is found at $2,593.70, followed by $2,577.23 and $2,561.89, key levels for maintaining bearish momentum.
The 4-hour chart reveals gold trading just below its 50 EMA at $2,620.02, signaling near-term weakness. The Relative Strength Index (RSI) stands at 43, reflecting mild bearish sentiment without indicating oversold conditions.
A break above $2,620.16 could shift momentum upward, targeting resistance at $2,638.91. Conversely, failure to hold above the pivot point may lead to declines, testing support at $2,593.70.
Gold’s price action is being shaped by broader market sentiment, with traders balancing geopolitical risks and expectations of the Federal Reserve’s 2025 rate policy.
A breakout above $2,638.91 would suggest renewed buying interest, while a decisive drop below $2,593.70 could accelerate selling pressure.
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