By Ion Jauregui - Analyst ActivTrades
The U.S. economy faces growing signs of recession, driven by uncertainty surrounding the Donald Trump administration's economic policies and global challenges. With clear signs of an economic slowdown in the U.S., gold is emerging as the asset of choice for those seeking to safeguard their wealth. With the environment marked by uncertainty and volatility, investors are increasingly turning to this precious metal, historically recognized as a safe haven in times of crisis. The impending U.S. recession, driven by a series of domestic factors and economic adjustments, has increased the demand for gold. This asset, not being directly linked to productive activity, offers stability in a scenario where confidence in other financial instruments is diminished. In times of recession, when the economic outlook becomes bleak, gold consolidates as a reliable bet to preserve the value of capital. The Trump administration's recent trade and fiscal measures have generated volatility in the markets, while the Federal Reserve's monetary policy remains a key factor.
Meanwhile, in Europe, the Vice-President of the European Central Bank, Luis de Guindos, has highlighted the economic risks in the Eurozone, which further reinforces the attractiveness of gold for stability-seeking investors. Moreover, the performance of gold prices on international markets reflects this phenomenon: while economic tensions and uncertainties are taking their toll on other sectors, the yellow metal continues to show resilience, reinforcing its role as a “safe haven”. In a context of possible recession, gold investment not only protects against currency devaluation and stock market volatility, but also positions itself as a solid alternative in the face of economic instability.
Technical Analysis
Gold has fluctuated since February 11 in a range between the highs of $2,956.06 and $2,888.05. Its mid-range is located around the current checkpoint (POC) of $2,915.56. The current price is slightly above it at $2,934.04 after having supported in the range zone to climb to the top of the current range. If we look at the RSI it is currently around the mid-range at 54% after a strong sell-off during the Asian trading day. We are seeing moves that can move the gold price in the direction of $3,000.
Historically, gold has been a safe haven asset during periods of crisis and, at the current juncture, its demand continues to rise. The recession could put pressure on the Fed to cut interest rates, which would further strengthen the precious metal's price. Against this backdrop, investors continue to see gold as a solid alternative in the face of the economic uncertainty ahead.
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The information provided does not constitute investment research. The material has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and such should be considered a marketing communication.
All information has been prepared by ActivTrades ("AT"). The information does not contain a record of AT's prices, or an offer of or solicitation for a transaction in any financial instrument. No representation or warranty is given as to the accuracy or completeness of this information.
Any material provided does not have regard to the specific investment objective and financial situation of any person who may receive it. Past performance is not reliable indicator of future performance. AT provides an execution-only service. Consequently, any person acing on the information provided does so at their own risk.
The U.S. economy faces growing signs of recession, driven by uncertainty surrounding the Donald Trump administration's economic policies and global challenges. With clear signs of an economic slowdown in the U.S., gold is emerging as the asset of choice for those seeking to safeguard their wealth. With the environment marked by uncertainty and volatility, investors are increasingly turning to this precious metal, historically recognized as a safe haven in times of crisis. The impending U.S. recession, driven by a series of domestic factors and economic adjustments, has increased the demand for gold. This asset, not being directly linked to productive activity, offers stability in a scenario where confidence in other financial instruments is diminished. In times of recession, when the economic outlook becomes bleak, gold consolidates as a reliable bet to preserve the value of capital. The Trump administration's recent trade and fiscal measures have generated volatility in the markets, while the Federal Reserve's monetary policy remains a key factor.
Meanwhile, in Europe, the Vice-President of the European Central Bank, Luis de Guindos, has highlighted the economic risks in the Eurozone, which further reinforces the attractiveness of gold for stability-seeking investors. Moreover, the performance of gold prices on international markets reflects this phenomenon: while economic tensions and uncertainties are taking their toll on other sectors, the yellow metal continues to show resilience, reinforcing its role as a “safe haven”. In a context of possible recession, gold investment not only protects against currency devaluation and stock market volatility, but also positions itself as a solid alternative in the face of economic instability.
Technical Analysis
Gold has fluctuated since February 11 in a range between the highs of $2,956.06 and $2,888.05. Its mid-range is located around the current checkpoint (POC) of $2,915.56. The current price is slightly above it at $2,934.04 after having supported in the range zone to climb to the top of the current range. If we look at the RSI it is currently around the mid-range at 54% after a strong sell-off during the Asian trading day. We are seeing moves that can move the gold price in the direction of $3,000.
Historically, gold has been a safe haven asset during periods of crisis and, at the current juncture, its demand continues to rise. The recession could put pressure on the Fed to cut interest rates, which would further strengthen the precious metal's price. Against this backdrop, investors continue to see gold as a solid alternative in the face of the economic uncertainty ahead.
*******************************************************************************************
The information provided does not constitute investment research. The material has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and such should be considered a marketing communication.
All information has been prepared by ActivTrades ("AT"). The information does not contain a record of AT's prices, or an offer of or solicitation for a transaction in any financial instrument. No representation or warranty is given as to the accuracy or completeness of this information.
Any material provided does not have regard to the specific investment objective and financial situation of any person who may receive it. Past performance is not reliable indicator of future performance. AT provides an execution-only service. Consequently, any person acing on the information provided does so at their own risk.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.