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Gold prices held gains near $2,620 on Monday, supported by heightened risk aversion and geopolitical tensions. Markets closely watch the incoming Trump administration’s policies and the Federal Reserve’s outlook for 2025, potentially influencing safe-haven demand for gold. Central bank purchases and geopolitical uncertainties, including the Russia-Ukraine conflict and Middle East tensions, have driven a 27% annual rally in gold prices. Technical indicators suggest consolidation, with resistance near $2,700 and support at $2,624.00-$2,628.00. The US Dollar’s subdued performance and falling Treasury yields provide further support for gold, though fewer Fed rate cuts next year could limit upside potential.

Key Highlights

# Gold prices edge higher, driven by increased risk aversion.

# Safe-haven demand grows amid geopolitical tensions and US policy shifts.

# Fed’s cautious stance on 2025 rate cuts limits gold’s rally.

# Technical support seen at $2,624-$2,628, resistance near $2,700.

# Gold closes 2024 with a robust 27% annual gain.

Gold prices continued to rise on Monday, trading near $2,620, as increased risk aversion and geopolitical tensions supported the safe-haven metal. The incoming Trump administration’s trade policies and the Federal Reserve's cautious stance on rate cuts for 2025 have kept markets on edge. Additionally, the subdued US Dollar and declining Treasury yields further bolstered gold’s appeal as a non-yielding asset.

The yellow metal’s impressive 27% rally this year, its best annual performance since 2010, was driven by central bank purchases, rising geopolitical risks, and easing monetary policies. Heightened tensions, such as the Russia-Ukraine conflict and Middle East unrest, have contributed to gold's gains. Over the weekend, Israeli strikes in northern Gaza escalated tensions, further increasing the demand for safe-haven assets.

From a technical perspective, gold prices are consolidating near the nine- and 14-day Exponential Moving Averages (EMAs), with immediate resistance at $2,700. A break above could target December’s high of $2,726.34. On the downside, gold finds support around $2,624-$2,628, with a breach potentially driving prices toward $2,583.

While gold remains supported by geopolitical risks and the Fed's cautious outlook, the prospect of limited rate cuts in 2025 could cap its gains. Nonetheless, the metal’s strong performance this year underscores its resilience amid global uncertainties.

Finally

Gold prices maintain upward momentum as risk aversion and geopolitical tensions persist. Immediate support at $2,624-$2,628 and resistance at $2,700 will guide near-term moves.

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