Gold is expected to continue being supported by political and economic uncertainty, as well as elevated inflation

Gold gained nearly 1% on the first trading day of 2025, signaling an initial positive outlook for a potential recovery from the $2582 level (Dec 18/19 higher base).

This is supported by the completion of a bullish failure swing pattern on the daily chart and a breakout above key resistance levels at $2637/$2642 (Fibonacci 38.2% of $2726/$2582 bear-leg and converging 20/30 DMAs).

The recent advance has breached the thin daily cloud (spanning between $2642 and $2663) and is putting pressure on the daily Kijun-sen ($2654).

A daily close above $2637 is considered essential to maintain bullish momentum, especially as the 14-day momentum remains in negative territory, signaling potential recovery stalls.

Fundamentally, the factors driving gold—political and economic uncertainty, persistent inflation, fiscal instability, and the unpredictable actions of Donald Trump’s administration—continue to provide strong support for further gains.

Gold surged 27% in 2024, marking one of the most substantial yearly increases in history, comparable to rallies seen in 2011 and 2020, reaching a new record high of $2790, breaking through the psychological $3000 barrier.

However, there is still a corrective phase to complete ($2790/$2536), with key resistance levels at $2663 (50% retracement) and $2700 (Fibonacci 61.8%/triangle resistance/psychological level). A breach of these levels could improve the near-term outlook, shifting focus to further upside, including the double-top formation at $2721/26 and Fibonacci 76.4% at $2730.

Res: 2663; 2693; 2700; 2726
Sup: 2633; 2621; 2617; 2600