- Gold is trading above $3000/oz, facing resistance but showing bullish signals.
- Tariff developments and US President Trump's comments are key drivers of market sentiment and gold prices.
- Gold ETF flows were strong in Q1 2025, with a record $21 billion inflow, but April data will be crucial.
- Technical analysis indicates key support levels at 3000, 2982, and 2950, and resistance at 3025 and 3050.
Gold prices have been on a grind higher this morning but apprehension and caution are still evident across financial markets. Gold's decline after President Trump's ‘liberation day’ tariffs were announced did come as a surprise to many but I for one had feared that a lot of the tariff risk had been priced in.
If I am honest however, I did not see such a sharp selloff even if markets had already priced in the tariff announcement. Since the drop, Gold's attempts at a recovery have been met with persistent selling pressure.
There does seem to be a disconnect between Gold and historical trends or price drivers. What I mean by this is that Gold is usually sensitive to moves by the US Dollar, however over the past 12-18 this was not the case. This has continued now with the tariff announcement as traditional safe havens like the CHF and JPY benefitted while what I would consider the most traditional safe haven, Gold struggled.
The factors for this could be endless but today we are seeing a similar story. Comments from US President Donald Trump have helped spur on risk assets as the US President spoke about making tariff deals. President Trump said that a delegation from South Korea is on its way and that he is waiting for China who in his words said ‘China also wants to make a deal, badly’.
This has given risk assets a boost but at the same time Gold has also enjoyed a largely positive day thus far. Tariffs risks no donut persist, but for the time being sentiment does seem to have improved.
Gold ETF March Report; Flows Were High but April Data Will Be More Intriguing
Gold ETF flows have been discussed in a few of my articles of late, with the World Gold Council releasing the March report earlier in the day. I did not expect too many surprises though as tariff announcements came out in April. The next issue should give us more insights on that and how Gold ETF (NYSE:GLD) flows fared in the days after the tariff announcement. When it comes to March and Q1 as a whole, ETF flows were strong.
Gold-backed ETFs saw a strong $8.6 billion inflow in March, pushing total Q1 inflows to $21 billion (226 tons). This was the second-largest quarterly inflow in dollar terms, just behind Q2 2020's $24 billion (433 tons). North America and Europe made up 83% of these inflows, with 61% and 22% shares, respectively. Asia contributed 16%, which is impressive considering it only holds 7% of global assets under management (AUM).
Europe’s Q1 inflows of $4.6 billion were its best since Q1 2020. With rising gold prices, global AUM hit a new record high of $345 billion, up 13% in March and 28% for the quarter. Collective gold holdings also grew by 92 tons in March, reaching 3,445 tons by the end of the month. This is the highest level since May 2023 and just 470 tons below the all-time record set in October 2020.
Source: World Gold Council
Given the selloff now in early April and depending where Gold ends the month, I will be very curious to gauge the data next month.
For now and the rest of the week, I expect tariff developments to be the main driving force of market sentiment and Gold as well.
Technical Analysis - Gold (XAU/USD)
From a technical analysis standpoint, Gold prices have edged their way higher since yesterday's lows at 2956.
The daily candle closed around the support level at 2982 before a bullish move in the Asian session leaves Gold trading 1% up for the day at the time of writing.
For now immediate resistance at 3025 has held firm with 3048/3050 the next key level to pay attention to.
The RSI period 14 on the daily timeframe is flashing a bullish signal as it crosses above the 50 neutral level which could hint at a shift in momentum. It will however depend on how the daily candle closes and see if it maintains the momentum and finishes above the 5o handle.
Today the 3000 psychological level has held firm and will need to form a base if bulls are to take control and revisit the early April highs.
If the 3000 handle gives way, 2982 and 2950 will catch my attention as potential areas of support.
Source TradingView
Support
3000
2982
2950
Resistance
3025
3050
3075