XAU/USD: Gold Prices Struggle with Momentum as Markets Run to Risk amid Trade Optimism

Bullion was floating near $3,200 a piece early Monday, off by 8.5% from its record high. Is more good news coming for global trade this week?

💥 Gold Prices Get Volatile

• Gold prices XAUUSD were gyrating around $3,200 early Monday morning with a short-lived blip to the upside that took the price to a session high of $3,250 per ounce.
• The spike was arguably driven by investors seeking out safe-haven assets after Moody’s on Friday downgraded the US credit rating to Aa1 from Aaa. In other words, escalating debt deficits and fiscal challenges dented the investment appeal of the US.

📞 Record High Is 8.5% Away

• Now with prices back near the $3,200 mark, gold once again drifted away from its record high of $3,500. How far away? About 8.5%, despite attempts from gold bugs to sustain the price and keep the bullish trend intact.
• After a series of positive news in global trade, gold lost 3.6% last week while riskier assets rallied. The S&P 500, the Dow Jones and the Nasdaq Composite are all back in the black for the year. By the looks of it, the 90-day tariff truce between China and the US has been warmly received by traders and investors.

👋 More News Coming Soon?

• What’s next for bullion and global markets in general? Treasury Secretary Scott Bessent said last week that the negotiations between China and the US will proceed until better conditions are reached.
• Any big announcement (likely coming from Donald Trump’s personal Truth Social account) could either extend the leg up or pour cold water on markets’ hopes and dreams.