Trade Gold on Geopolitical Risks and US Data this Week

Gold has been treading water in relatively tight ranges recently, but that calm looks increasingly fragile as traders eye a burst of volatility ahead. Geopolitical risks are creeping higher, and with a backlog of key US economic data hitting the market in the next couple of days, many feel a breakout is now a matter of when, not if.

Tensions between China and Japan over Taiwan remain front of mind, while reports of possible movement toward a ceasefire in the Russia–Ukraine conflict continue to keep markets guessing. Either scenario has the potential to shake up flows in the world’s favourite safe-haven metal. Any escalation could see gold making another run at the highs, while signs of cooling tensions could just as easily send it lower out of recent ranges. Any moves on the geopolitical front in the last couple of days of the week could see exacerbated moves, with liquidity likely to be much thinner than usual.

On the US side of the equation, the calendar is packed ahead of the Thanksgiving holiday, and that’s adding another layer of uncertainty. Fed rate expectations have been on a rollercoaster for over a week, and traders know that any surprises in the data could tip the scales again. PPI and Retail Sales are due Tuesday, with GDP, jobless claims, and the all-important Core PCE Price Index all landing on Wednesday — a cluster of releases that could easily light a fire under gold markets sitting at technically sensitive levels.

Resistance 2: $4,244.94 – November High
Resistance 1: $4,193.50 – Trendline Resistance

Support 1: $4,035.29 – Trendline Support
Support 2: $3,886.02 – 28 October Low

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