Gold price reaches a new weekly high driven by geopolitical tensions and expectations of interest rate cuts

Gold continues its positive trajectory this week, hitting new short-term highs as investors seek refuge in safe-haven assets. The combination of global instability and signals of possible monetary easing by the Fed keep the yellow metal in high demand, with today’s gold price reflecting this favorable dynamic.

Geopolitical factors reinforce demand for defensive assets

The escalation of international tensions has been key in supporting the gold price. Military conflicts involving the US and Venezuela, along with increasing disputes between Saudi Arabia and the United Arab Emirates, create an environment of uncertainty that favors the precious metal as a safe haven. The situation in Iran and the prolonged war between Russia and Ukraine further amplify this demand for protection.

President Donald Trump signaled over the weekend the possibility of new military interventions in Latin America if there is no cooperation, raising concerns about regional instability. These events strengthen the case for gold buyers, who see the metal as a hedge against geopolitical risks.

Dovish expectations from the Federal Reserve weaken the dollar and benefit gold

Alongside geopolitical factors, the market continues to price in two possible interest rate cuts by the US central bank by the end of the year. Recent PMI data — with the S&P Global manufacturing index remaining steady at 51.8, while the ISM fell to 47.9 — were not enough to temper expectations of a more flexible stance from the Fed.

This outlook of lowering borrowing costs weakened the US dollar, pulling it away from the four-week high recorded the previous day. Since gold does not pay interest, the depreciation of the dollar makes the yellow metal more attractive to international investors, further boosting purchases.

Concerns about potential political pressures on the independence of the Federal Reserve under the Trump administration also contribute to this dynamic, motivating flows into assets uncorrelated with the US dollar.

Technical analysis indicates continuation of the bullish movement

From a technical perspective, gold’s price shows promising signs of strengthening. The break of the 100-hour Simple Moving Average during the Asian session represents a critical point, and a breakout of the resistance zone between $4,445 and $4,450 could open the way for further gains.

The MACD indicator shows a positive histogram and its line is slightly above the signal line near zero, signaling improved momentum. The Relative Strength Index (RSI) is at 68, indicating considerable strength, with room to move toward the overbought level at 70.

The 100-hour Moving Average, currently at $4,373.28, acts as an important dynamic support. As long as the price remains above this level and the MACD stays positive, corrections are likely to be superficial, supporting the short-term trend.

Non-farm employment report on Friday will be a crucial catalyst

The next major catalyst for the gold market will be the US non-farm payrolls report (empregos não agrícolas) scheduled for Friday. This indicator will provide concrete signals about the health of the US labor market and, consequently, about the path of interest rate cuts the central bank will follow.

Traders are closely watching this number, as it could generate significant directional momentum for both the dollar and the gold price. A weaker result would reinforce dovish bets, while a strong outcome could temper expectations of easing.

Until then, other macroeconomic indicators this week will offer additional clues about the economic scenario, but the main focus remains on the employment report, which will determine the most significant movements of the precious metal in the coming days.