(Kitco News) – The gold market’s first full trading week of 2025 got off to a rocky start, but bullish momentum continued to build as the week progressed, and by Friday, market participants were predicting another run higher for the yellow metal on the eve of the second Trump term.
Spot gold kicked off the week trading at $2,690 per ounce, but all of the momentum on Sunday evening and early Monday was to the downside. By 5:15 a.m. Eastern, spot gold had declined to $2,678, and by 8:30 a.m., the yellow metal was trading at $2,665 per ounce. The North American open brought a momentary spike above $2,670, but this was short-lived, and by 2:00 p.m. spot gold was languishing at $2,657 per ounce.
This proved to be the weekly low, however, and by 7:30 p.m. Eastern gold was once again trading above $2,670 per ounce. A few minutes before Tuesday’s market open, gold had slid back to $2,661 per ounce, but North American traders once again pushed it back above $2,670, and following a retest of this support level just before 9:00 p.m., the yellow metal began its steady climb and never looked back.
Wednesday morning’s better-than-expected CPI report drove spot gold to $2,693 per ounce, a new weekly high at the time, and after a late morning retest of $2,680, this level became the new floor for the price action. At 3:00 a.m. Eastern, spot gold broke definitively through the $2,700 per ounce resistance level, and by the Thursday North American market open, gold was trading at $2,717.
The yellow metal set the weekly high just below $2,725 per ounce shortly after noon Eastern on Thursday, and though markets saw some price volatility through Thursday and Friday, multiple retests showed the $2,700 per ounce level holding as firm support into the weekend.
The latest Kitco News Weekly Gold Survey showed strong bullish sentiment from industry experts and retail traders ahead of Donald Trump’s second inauguration.
“Barring any major issues with Monday’s Inauguration, I expect gold prices to remain relatively unchanged next week,” said Rich Checkan, president and COO of Asset Strategies International. “Everyone has adopted a ‘wait and see’ attitude with regard to President Trump’s policies and the effects they might have on the economy. One week is simply not enough time to see anything. We will need to wait longer to see the impact.”
“Somewhat lower, if the new POTUS will talk tariffs, which suggest higher inflation, and the Fed is seen as being serious about its inflation target,” said Bart Melek, managing director and global head of commodity strategy at TD Securities.
“I’m sticking with bullish, even if I do think a pullback is possible,” said James Stanley, senior market strategist at Forex.com. “Gold just broke out of a triangle that had been building for the past couple months. Spot is testing resistance at 2721 and that’s already given two aggressive reactions with this week being a third, but I think a pullback to a higher-low could be attractive for continuation purposes at this point.”
“The gold price rose to USD 2,725 per troy ounce yesterday, its highest level in a month,” said Carsten Fritsch, commodity analyst at Commerzbank. “At the same time, gold is on course for its third consecutive weekly rise. However, the reasons behind this have changed. Initially, it was the (geo-)political uncertainties and the resulting increased demand for gold as a safe haven that caused the price to rise. In recent days, this factor has lost traction as a six-week ceasefire has been agreed between Israel and Hamas, which is due to come into force at the weekend.”
“Meanwhile, interest rate expectations have recently come back into focus,” Fritsch added. “Following the lower-than-expected US inflation data, the market is again pricing in slightly more Fed rate cuts. This has halted the surge in the US dollar and led to a fall in US bond yields. However, it is worth noting that the previous appreciation of the US dollar and the significant rise in yields did not weigh on the gold price. We can therefore speak of an asymmetric market reaction here. Such episodes do not usually last long. We are therefore skeptical as to whether the gold price will be able to maintain its high level. This would require a further increase in expectations of interest rate cuts, a weakening of the USD and a further fall in bond yields.”
Kevin Grady, president of Phoenix Futures and Options, was looking at the state of the gold market at the midpoint of January, and he sees plenty of support for prices to move higher.
“I think the market held some good levels,” Grady said. “There are buyers under the market. What pushed it down was some weak hands and longs that were in the market, and they weren't sure what was going on and they got spooked out. But I think the strong hands, the central banks, came in, and I think they're continuing to buy.”
“I don't think that's going to change,” he added. “I think that scenario stays intact.”
Grady said he’s still bullish on the yellow metal for 2025 as a whole. “I think we should hit $3,000 this year,” he said. “The only thing is, we have to see where how the tariffs work out. I mean, gold is a physical market, and they move gold from New York to London to New York, back and forth. We have to see how that's going to go, and the jury's still out on that. We don't really know. [Trump] said it could be a part of it, it could not be.”
“It definitely is affecting the physical market,” he warned. “I think that's something we have to really keep an eye on.”
Grady thinks that predicting the near-term direction of gold prices is very difficult right now because so much hinges on how Trump’s tariffs shake out.
“It's very hard to tell what the price is going to go to,” he said. But I ultimately think that you have strong buyers in the market, and any sort of dip that comes in, these guys are below there, they're buying into it, they use any sort of weakness to buy. And I don't think that's going to change.”
“These people are not getting out,” he added. “They are holding, especially with the price appreciation, they see what's going on, they see what's happening in the physical market. They are not stupid, and they are not getting out.”
This week, 11 analysts participated in the Kitco News Gold Survey, with nearly two thirds of respondents predicting higher gold prices in the coming days. Seven experts, or 64%, expected to see gold prices rise during the week ahead, while two analysts, or 18%, predicted a price decline for the precious metal, and another two chose to sit on the sidelines until the picture becomes more clear.
Meanwhile, 156 votes were cast in Kitco’s online poll, with Main Street investors only slightly more bullish than the experts. 105 retail traders, or 64%, looked for gold prices to rise next week, while another 34, or 22%, expected the yellow metal to trade lower. The remaining 17 investors, representing 11% of the total, expected gold to trend sideways in the near term.
Next week’s economic calendar is on the light side, but one major political event will draw the markets’ attention: The Monday inauguration of President-elect Donald Trump to his second term in office, with traders listening for further indications of the scope and specifics of his proposed tariffs.
Thursday will also see the release of U.S. weekly jobless claims, and Friday’s S&P Flash PMI data and U.S. Existing Home Sales will round out the docket.
Marc Chandler, managing director at Bannockburn Global Forex, is predicting fresh all-time highs for gold in 2025, and he sees the near term as supportive as well.
“I like the yellow metal and suspect it can make a new high before corrective forces are seen,” he said. “It peaked in late October near $2790 and by mid-Nov set the low near $2537. Since then, it has been irregularly trending higher. It approached the upper end of its recent range on Jan 16 near $2725 and consolidated ahead of the weekend.”
“News that China’s PBOC resumed buying gold, the uncertainty surrounding the policies and sequence of the new US administration and pullback in US rates may encourage buying pullbacks in gold,” Chandler added.
John Weyer, director of the commercial hedge division at Walsh Trading, was analyzing gold’s 2025 performance to date in the context of the incoming Trump administration.
“We're getting a bounce here to start the new year, and you're still seeing metals moving higher,” Weyer said. “We're going to get an extension of the 2017 tax cuts, but there's a lot of concern about what may happen regarding tariffs. There's a little bit of uncertainty out there.”
He noted that we’re seeing some of the cryptos go up as well. “They're the new alternative market, and I think they're a lot like the metals in that people look for something else when they're unsure about the mainstays,” he said.
“I think gold could continue to push higher gradually,” Weyer added. “I know a lot of people out there think it's going to be screaming to the upside. I think it's going to be more slow and steady. The numbers here in the United States aren't terribly bad, but much of the rest of the world is lagging. We're not quite thriving, but we're stable and still somewhat bullish on the economy here.”
“I think the flight to quality and safety is in play.”
Weyer said the fact that gold is rising in an environment of USD strength is very telling. “In the old world economics that I grew up in, traditionally gold and the U. S. dollar have an inverse relationship,” he said. “When you see them both move in the same direction, to the upside generally, that is flight quality from offshore. We saw some dollar strength over the past year, and at the same time, you're seeing gold continue to move higher. I think a lot of that has to do with those foreign economies looking maybe not so shiny, and they're looking for somewhere to go.”
Weyer said he doesn’t think gold is overbought at its current levels. “I think we'll hang around above $2,700,” he said.
Analysts at CPM Group issued a buy recommendation for gold on Thursday, with an initial target price of $2,800.
“The increase in prices reflects buying by institutional investors and, more importantly, investor buying related to concerns about the political and economic outlook for the United States and the rest of the world in 2025,” they wrote. “There also has been rising speculation that President Trump might impose prohibitive tariffs on imports that could include gold and silver.”
CPM expects prices will continue to rise for at least a couple more days. “New York has a holiday on Monday while London will remain open,” they noted. “Trump’s inauguration will be Monday as well, and he has promised, or threatened, to issue many executive orders. Speculators think some might include those tariffs. Gold prices could surge to $2,800 or higher while silver prices could spike toward $33.00, $33.50, or more. There is potential for this to occur in the very short term, meaning that over the next few days.”
The analysts also noted that the February gold Comex contract becomes deliverable at the end of January, and many market participants are rolling their positions into the April contract.
“As of 15 January there were 28.2 million ounces of open interest in the February Comex contract while there were 17.2 million ounces of open interest in the April Comex contract,” they said. “With around two weeks left in January, there remains scope for prices to continue to rise as market participants close out their February positions and buy April positions. Total open interest was 53.8 million ounces as of 15 January, up sharply from 45.9 million ounces at the end of December. The large increase in open interest and rise in prices suggests long positioning overall.”
They also noted a heavy volume of arbitrage between London and New York. “Some bullion dealers actually were buying London metal and moving it to New York,” they said. “As the spread widened, speculative market participants were buying London and selling New York. If the London market grows particularly tight, London prices would rise sharply, reversing the price differential with New York. This price spread reversal would lead to a reversal of the flow of silver, out of New York back toward London.”
“I am bullish here,” said Michael Moor, Founder of Moor Analytics. “In a higher time frame, we are still in an overall bull trend from November 2015, and likely in the later stages. Part of this is a prediction I made of $151 minimum, $954 (+) maximum from $2,148.4 – of which we have attained $653.4 so far. This is OFF HOLD. In a Medium time frame, the trade below 27730 brought in $231.5 of the pressure warned about. This is ON HOLD.”
“On a Lower time frame, the trade above 27041 (-0.6 of a tic per/hour) has brought in $53.8 of strength,” he added. “The trade above 27247 (-.6 of a tic per/hour) now projects this upward $55 minimum, $235 (+) maximum – we have attained $33.2.”
Moor warned, however, that “we are likely in yet another 'last stretch' of the move up from 25967, with areas of possible exhaustion at 27573, 27739, 28103, and higher – we are currently holding the lower of these with a 27579 high and have rolled over $28.5. A further decent break back below 27229 (-.6 of a tic per/hour starting at 10:20 am) should bring in additional pressure and solidify entrance into a lower timeframe bearish correction/trend.”
“Cycle’s up until February,” said Mark Leibovit, publisher of the VR Metals/Resource Letter. “May see some downside afterwards.”
At the time of writing, spot gold last traded at $2,703.15 per ounce for a loss of 0.43% on the day but a gain of 0.51% on the week.
