Gold prices soared to record highs, driven by escalating geopolitical tensions and market expectations that the Federal Reserve will further cut interest rates, delivering the best annual performance in more than four decades.
Gold and silver prices rose by more than 1%, surpassing the historical record of $4,381 per ounce set in October. Traders are betting that the Federal Reserve will cut interest rates twice in 2026 as a series of economic data released last week provided no clearer picture of the economic outlook, despite President Trump’s insistence on significant rate cuts. Loose monetary policy is a positive factor for gold and silver, which do not pay interest.
The escalating geopolitical tensions in recent weeks have also enhanced the safe-haven appeal of gold and silver. The United States has intensified its oil embargo on Venezuela, further pressuring the government of Venezuelan President Nicolás Maduro; meanwhile, Ukraine has for the first time attacked an oil tanker belonging to Russia’s shadow fleet in the Mediterranean Sea.
Central bank gold purchases, physical demand and geopolitical hedging remain the anchor factors for medium and long-term prices, while Fed policy and real interest rates continue to drive cyclical fluctuations. Some new players, such as stablecoin issuers like Tether and certain corporate finance departments, have begun to allocate to gold. This broader capital base has enhanced the resilience of demand.
Technical analysis:
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Gold: The price continues to set new historical highs, and the trend of strength remains. However, as this week is the Christmas week, liquidity is relatively weak. We suggest continuing to focus on the rebound signals after the liquidity is swept. For detailed positions, please consult the plugin.
(Gold 15-minute chart)
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The Nasdaq rebounded and recaptured the 25,200/25,300 level as inflation data eased further and the Bank of Japan’s attitude remained relatively moderate after its rate hike. However, with the Christmas week approaching, trading volume may weaken. We will continue to wait for low liquidity before starting to capture the rebound signal. For detailed positions, please consult the plugin.
(NASDAQ 15-minute chart)
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Crude oil: The yellow zone liquidity alert issued by the plugin yesterday was not swept. For today, we suggest waiting for the liquidity to be swept before considering new rebound signals. For detailed positions, please consult the plugin.
(Crude Oil 15-Minute Chart)
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Today’s key economic data and events to focus on:
19:00 UK CBI Retail Sales Expectations Index for December
19:00 UK December CBI Industrial Order Expectations Diff.
