The peace deal announced over the weekend by President Trump has given a broad range of asset markets a welcome lift - including the precious metals complex. Gold has built on last Thursday's rally and appears well-positioned for further gains, though the next leg higher will largely depend on how this week's FOMC meeting plays out. The Federal Reserve is widely expected to hold interest rates steady, but investors will be paying close attention to the views of new Fed Chair Kevin Warsh - particularly his stance on inflation. Should Warsh signal a willingness to look past current inflation levels, perhaps framing the peace deal as a disinflationary tailwind, rate-sensitive markets could receive a meaningful secondary boost.
On the technical side, gold has a couple of key hurdles to clear. First, the spot price needs to push decisively above the 50-day simple moving average, currently sitting at $4,581/oz. Beyond that, the May 12 lower high at $4,773/oz. represents the next significant resistance level. A clean break above both would open the door to a more sustained move higher. With the political background improving, attention now shifts squarely to the Federal Reserve.
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