After a slight decline in recent weeks, gold has once again taken flight, surpassing the psychological threshold of $3,000 per ounce for the first time. Since the beginning of the year, the ultimate safe-haven asset has gained 15%, and in the last five years, the price has more than doubled.

It is interesting to understand what is driving the precious metal higher, pushing it toward new peaks. Most importantly, it’s worth asking what will happen now. Will gold's rise slow down, or is it unstoppable as it seems?

Tariffs and Geopolitical Tensions Among the Reasons for the Rise

The attack launched by Israel on Gaza on March 17 has definitively ended the truce in the Middle East. The markets reacted with dismay to the news, with an immediate upward reaction of the yellow metal, which reached $3,017.64 per ounce.

A contributing factor to the rise in gold is a struggling dollar, which is being traded at five-month lows against several other currencies. The reason for this is traders’ fears of a U.S. recession, as they look with concern at the potential trade wars that the Trump administration threatens to trigger.

Tensions in the Middle East and the escalation of the trade conflict between the U.S. and China are pushing investors toward safe assets, fueling demand for physical gold and contributing to the price increase.

Outlook for the Future

To determine the future direction of the gold market, the decisions made by three central banks this week will be crucial. In the spotlight is the Bank of Japan, which, with the recent wage growth and persistent inflation, could adopt a more restrictive monetary policy.

No surprises are expected from the Federal Reserve, which should keep interest rates unchanged; however, if Jerome Powell were to signal an earlier rate cut, the price of gold would be further driven upward.

On the other side of the Atlantic, the Bank of England is likely to keep interest rates at 4.5%, despite persistent inflation. Examining the chart below, the bullish outlook for gold prices is immediately clear. The support zone for the price now rests between $2,929 and $2,956 per ounce—once a resistance area.

Although the market remains primarily bullish, if gold were to fall below $2,880, a deeper price correction could unfold.

On the other hand, if we see a decisive break above the $3,000 threshold, the next Fibonacci targets are set at $3,032, which would represent a 161.8% extension of the mini-decline in October, followed by $3,043, corresponding to a +200% increase from the last significant drop recorded between October and November.

What’s Next for Gold After Breaching the $3,000 Barrier?

Conclusion

In conclusion, growing pressure in the markets and geopolitical upheavals continue to provide strong support for the price of the yellow metal.

The surpassing of the $3,000 threshold represents a historic milestone for the precious metal, but only the coming days will tell whether gold will lose ground or, on the contrary, consolidate this new peak.

For now, all we can do is wait.

 

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