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Spot Gold Defies Gravity as Bulls Target US$3,400 Amid Geopolitical and Fiscal Risks

Despite recent weakness, the yellow metal continues to defy gravity, pushing higher with bulls eyeing a potential move toward the all-time high of $3,500 reached in late April.

Meanwhile, the US Dollar (DXY) slipped to 98.40 after softer-than-expected inflation data were released.

May CPI rose 2.4% YoY (vs. 2.5% forecast), with core CPI steady at 2.8%, easing concerns over Trump’s tariffs.

President Trump renewed calls for a full percentage point rate cut while markets await Thursday’s US PPI data.

US-China trade talks also showed signs of progress, although China is reportedly limiting rare-earth export licenses to US manufacturers for a six-month period.

Technically, momentum has improved for spot gold, with the Relative Strength Index (RSI) rebounding into positive territory, indicating strengthening bullish momentum.

The Moving Average Convergence Divergence (MACD) remains in a state of indecision, showing limited conviction in either direction.

Meanwhile, the Average Directional Index (ADX), which measures the strength of a trend regardless of its direction, continues to signal a modest bullish trend.

With underlying support from persistent geopolitical tensions and ongoing US fiscal risks, the rebound is expected to extend, potentially paving the way toward the $3,400 level.

Initial support is noted at $3,364, with a firmer footing seen in the $3,349–56 zone.

Initial support is noted at $3,364, with a firmer footing seen in the $3,349–56 zone.

Daily Chart Spot Gold

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