Gold Price Stays Weak, Below Tuesday’s High as US Dollar Strengthens
Gold is having a hard time moving higher and is still trading below the multi-week high it reached on Tuesday. One of the main reasons is the stronger US dollar. When the dollar gets stronger, gold becomes more expensive for buyers using other currencies, so demand goes down.
Another reason gold is under pressure is because investors think the US Federal Reserve may keep interest rates high for longer to fight inflation. When interest rates are high, people prefer assets that give returns, so gold – which doesn’t give any interest – becomes less attractive.
Also, global markets are showing a positive mood, so investors are not looking for safe-haven assets like gold right now. They feel more confident, and that’s reducing the need for gold as a safety option.
From a technical point of view, gold is facing resistance. It’s not able to cross the $2,910 level. If the price falls below $2,880, there could be more selling. But if it moves above $2,910, it might bring in new buyers.
Impact: Gold might stay weak if the US dollar continues to rise and market mood stays positive. Upcoming US data could decide gold’s next move.