5 min readGold (XAU/USD) rose to a record high of $3500 at the start of the week. However, the price failed to maintain this level, falling back to $3340 at the time of writing. While the price has fallen quickly in recent days, this is a drop in the ocean compared to how much the precious metal has gained not just this year (26%) but also across recent years.
The question is whether Gold can continue recover to retest the $3500 ATH or even push towards $4000?
Why is Gold rising?
Gold has risen sharply this year on safe-haven flows amid Trump trade tariff worries and concerns over the impact of such policies on the growth outlook. While investors have sold out of riskier assets such as US stocks, safe havens such as Gold, the Japanese yen, and the Swiss Franc have outperformed.
The recent pullback from 3500 to 3300 came on optimism that Trump’s administration may adopt a softer stance towards trade tariffs on China. However, Treasury Secretary Scott Bessent quashed any hopes of a de-escalation in the trade war between the US and China, saying Trump made no unilateral offer to cut China’s tariffs.
Worries over Trump interfering with the Federal Reserve have also supported Gold prices. Trump talked of firing Fed Chair Jerome Powell at the start of the week, although he walked those comments back later.
Could Gold rise further?
Gold will likely remain bullish given the ongoing trade tensions and rising recession risks, as central banks continue buying and safe-haven demand remains strong. JP Morgan forecast Gold rising to $4000 per ounce by Q1 2026 in the case of an ongoing US – China trade war with central banks expected to net 710 tonnes a quarter.
What are the risks for Gold reaching new record highs?
In terms of a potential bearish case for Gold, a drop in central bank demand remains the most significant fundamental risk. US economic growth remains resilient to trade tariffs, or the Federal Reserve adopts a more proactive approach to controlling inflation risks, which would see the market price increase in rate hikes. These scenarios would be more bearish for Gold.
Gold technical analysis – levels to watch
Gold ran into resistance at 3500 the ATH and rebounded lower, pulling the RSI out of overbought territory. The price found support in the 3245-3285 support zone. The uptrend remains and buyers will look to rise above 3400 before brig 3500 back into play.
Support is at the 3245-85 zone, with a break below here opening the door to 3200. A move below 3167, the April 3 high, would negate the near-term uptrend.
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