Gold prices pull back from a new record high, but strong fundamentals suggest downside remains limited

Gold prices edged lower on Tuesday as traders took partial profits, responding to overbought daily indicators despite a fundamentally supportive backdrop.

Earlier in the session, the metal surged to a new record high of $2,942 after fresh U.S. tariffs on steel and aluminum imports reignited fears of an escalating trade war and its potential negative impact on the global economy.

However, comments from Fed Chair Powell, signaling no urgency for rate cuts due to stable economic conditions and a resilient inflation outlook, introduced some headwinds for gold.

Investors now await Wednesday’s release of U.S. January CPI data, which could provide further clarity on near-term direction.

So far, the dip remains shallow, with a Doji candle on the daily chart reflecting market indecision and calling for additional confirmation of trend direction.

Key support levels are seen at $2,880 (session low/5DMA), followed by the ascending daily Tenkan-sen at $2,850 and the 38.2% Fibonacci retracement of the $2,582–$2,942 rally at $2,805.

On the upside, resistance is set at $2,946 and $2,983 (Fibonacci projections), ahead of the psychological $3,000 mark.

Res: 2942; 2946; 2983; 3000
Sup: 2880; 2850; 2834; 2805