Daily Market Analysis from ForexMart

Gold prices rise amid escalating trade disputes

On Monday, gold prices rose slightly after a sharp decline at the end of last week. The current quote for spot gold is $2,898 per ounce. Despite the local weakening, the asset is still near record highs in the area of $2,960.

Interest in the precious metal remains due to its status as a «safe haven» amid ongoing uncertainty around trade tariffs and interest rate changes in the United States.

Over the past two weeks, gold has repeatedly updated its record values. The rise in prices for the precious metal was the result of increased interest from investors seeking to minimize risks. This happened after Donald Trump imposed 25% duties on steel and aluminum imports into the United States.

In addition, the head of the White House announced his intention to introduce additional tariffs in response to the actions of the country's leading economic partners. Despite this, such measures are expected no earlier than April.

Where Have Dollar Buyers Gone?

Yesterday, President Donald Trump's statements about new trade tariffs were largely ignored by dollar buyers. However, risk-asset sellers were also notably absent.

During his speech, Trump announced that he would likely impose tariffs on imported cars, semiconductors, and pharmaceutical products, with rates expected to be around 25%. These tariffs are likely to take effect on April 2. While such a move would escalate the ongoing trade war, the market showed little reaction.

It is worth recalling that Trump had previously announced 25% tariffs on steel and aluminum, set to take effect in March. "I'll probably tell you on April 2, but it's going to be somewhere around 25%," Trump told reporters at his Mar-a-Lago club when asked about the planned auto tariffs.

Regarding tariffs on pharmaceuticals and semiconductors, Trump stated: "The tariffs will be 25% or higher, and they will increase significantly over the year." He explained that he wants to give companies time to adjust before introducing new import taxes. "Let companies come to the United States and open their factories here, and then there won't be any tariffs," Trump added.

Impact on the Auto Industry
Experts warn that new auto tariffs could have widespread consequences for the industry. Last year, around 8 million cars and light trucks were imported into the US, accounting for nearly half of all car sales.

Major European automakers, including Volkswagen AG, as well as Asian manufacturers like Hyundai Motor Co., will likely be among the hardest hit.

Trump did not specify whether these measures would target specific countries or apply to all imported vehicles. It is also unclear whether cars produced under free trade agreements with Canada and Mexico would be exempt.

For Mexico and South Korea, where auto exports to the US make up 2.4% and 1.8% of GDP, respectively, Trump's new tariffs pose a serious economic challenge.

Impact on the Semiconductor Sector
In the semiconductor sector, Malaysia and Singapore are expected to be among the hardest-hit nations. Malaysia, the sixth-largest exporter of semiconductors, recorded $136 billion in semiconductor exports in 2024.

Representatives from Samsung Electronics Co. and Taiwan Semiconductor Manufacturing Co. declined to comment on the new tariffs.

Potential Retaliatory Measures
Recently, US trading partners have vowed to respond swiftly to Trump's tariffs, warning that they will target politically sensitive US-made goods.

A top European Union trade official is expected to travel to Washington this week for last-ditch talks aimed at avoiding the April tariffs. However, Trump has made it clear that no country will be able to negotiate its way out of the tariffs if he considers trade relations to be imbalanced.

EUR/USD Technical Outlook
Right now, EUR/USD buyers need to push the price above 1.0475. This will open the way for a test of 1.0510. Breaking above this level could lead to an advance toward 1.0554, though achieving this without support from major players will be challenging. The long-term target remains 1.0590.

If the pair declines, serious buying interest is expected around 1.0430. If buyers fail to emerge at that level, a drop to 1.0400 or even 1.0370 could be on the horizon.

GBP/USD Technical Outlook
For GBP/USD buyers, the key level to break is 1.2630. Successfully overcoming this resistance could lead to a test of 1.2665, though further gains beyond this point would be difficult. The final target stands at 1.2690.

If the pair falls, bears will attempt to regain control at 1.2590. A break below this range would seriously weaken bullish positions, pushing GBP/USD toward 1.2550, with a potential move down to 1.2515.

XAU/USD. Analysis and Forecast

Gold continues its strong upward momentum, reaching a new all-time high above $2,950. The surge is driven by concerns that U.S. President Donald Trump's proposed tariffs could lead to a global trade war, increasing demand for gold as a safe-haven asset. Additionally, the decline in U.S. Treasury yields is further supporting bullish sentiment in the gold market.

The FOMC meeting minutes released on Wednesday confirmed expectations that the Federal Reserve will maintain its policy pause for an extended period. While this could deter traders from opening new positions, potentially limiting gold's gains, the overall fundamental backdrop remains bullish, suggesting that the path of least resistance for XAU/USD is still upward.

Technical Outlook for Gold (XAU/USD)

From a technical perspective, the daily Relative Strength Index (RSI) is trading above 70, indicating overbought conditions and calling for caution among bulls. This suggests that gold prices could consolidate within a weekly range before attempting another move higher.

The short-term trend remains bullish, and a sustained break above the $2,945–2,950 resistance zone could pave the way for further gains.

Key Support and Resistance Levels:

Immediate support is located at $2,930, followed by yesterday's low at $2,918 and the psychological level of $2,900.

A break below $2,900 could lead to deeper corrective declines towards $2,880, with further downward potential extending to the $2,860–2,855 region and the $2,834 support level.

If selling pressure intensifies, gold could drop toward $2,815, followed by $2,800 and the critical support zone at $2,785–2,784.

On the other hand, a clear breakout above $2,950 would confirm bullish momentum, potentially driving gold prices toward $3,000 and beyond in the coming sessions.