Gold (XAU/USD) is approaching a critical juncture, with major U.S. inflation reports and geopolitical risks poised to drive its next big move. After rallying last week despite a significant commodity fund rebalancing, gold remains supported by expectations of Fed rate cuts and safe-haven demand. This week, traders are focused on CPI and PPI data for clues on monetary policy, while escalating tensions—particularly involving Iran—could fuel further gains toward all-time highs.
Major Points Highlighted:
Inflation Data in Focus:
December CPI (Tuesday) and PPI (Thursday) will heavily influence Fed rate-cut expectations and gold’s direction.
Higher-than-expected inflation could dampen bullish momentum, while in-line or softer data may support further rallies.
Geopolitical Wildcards:
Rising tensions with Iran are seen as a key bullish catalyst; any escalation could trigger strong safe-haven flows into gold.
Venezuela’s crisis already spurred buying last week, highlighting gold’s role during geopolitical uncertainty.
Technical Outlook Stays Bullish:
The main trend is up, with a breakout above $4,550.15 likely to resume momentum toward record highs.
Key support lies between $4,381.44 – $3,866.46, while the 52-week moving average reinforces longer-term bullish structure.
Recent Price Drivers:
Gold surged early last week on Venezuela-related safe-haven demand, then dipped due to index rebalancing.
Weaker U.S. jobs data reinforced Fed dovish expectations, helping gold rebound and decouple from dollar strength.
Fed Policy Sensitivity:
Gold remains tied to shifts in rate-cut odds. Sustained bullish sentiment depends on inflation not exceeding forecasts.
Bottom Line:
Gold’s path is now tied to U.S. inflation outcomes and geopolitical developments—especially regarding Iran. A bullish setup remains intact, with a break above $4,550.15 likely to trigger a run to new record highs.
