⏬Gold Plummets Nearly 1.5%

The market was rattled last week by the implementation of significant reciprocal tariffs by the United States. In the gold market, investors had been almost certain that high tariffs, particularly on imports from Switzerland and Canada, would not apply to gold, a belief supported by an announcement in April. However, the official tariff schedule lacked an explicit exemption for bullion, leading to a sharp surge in the price of COMEX futures contracts relative to the spot price. This premium at one point reached as high as $100 per ounce before stabilizing in the $50-$60 range.

Two key pieces of news emerged on Friday, shifting the market dynamics. First, the U.S. government announced that recent market movements were based on misinformation and that an executive order would soon be published to clarify the tariffs on gold bars and other products. This news triggered a price drop, although gold ultimately closed at its highest level since July 23.

Additionally, it was announced that Donald Trump and Vladimir Putin would likely meet in the second week of August. Over the weekend, the location was confirmed as Alaska. The meeting's agenda is focused on reaching a ceasefire agreement in Ukraine. While this marks a significant diplomatic breakthrough and the first high-level meeting of its kind, doubts have emerged. Observers question whether Russia will be willing to make concessions or if the negotiations will yield terms unacceptable to Ukraine, potentially leading to renewed personal attacks on Ukraine from the U.S.

Gold price is testing 25 and 50 SMA, after reaching on Friday the highest level since July 27. Source: xStation5