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• Gold touched the all-time high of $2,954 amid trade policy uncertainty on Friday.
• Trump expanded tariffs to lumber and soft commodities, which added to the market's jitters.
• US data came in mixed: Manufacturing PMI improved, but Services PMI numbers contracted.

The price of gold slid during late trading on Friday, although it seemed set to end the week on a positive note, as it accumulated eight straight weeks of gains that pushed the yellow metal to all-time highs of $2,954. As of the time of writing, the XAU/USD currency cross was seen trading at around $2,940, down approximately 0.15%.

The financial markets' narrative did not notably change as US President Donald Trump continued with rhetoric related to tariffs. In addition to imposing 25% tariffs on cars, pharmaceuticals, and chips, Trump broadened duties to lumber and other soft commodities.

This fueled the recent rally in bullion prices as investors that sought safety drove prices higher amidst uncertainty about US trade policies. Meanwhile, geopolitics took a second stage as there was some progress in the discussion to end the Russia-Ukraine war, which relieved the markets.

Data-wise, business activity in the United States was mixed. The manufacturing PMI improved. Conversely, the Services PMI plunged for the first time since January 2023. Other data showed that Existing Home Sales plunged, and the University of Michigan (UoM) Consumer Sentiment Final reading for February deteriorated further.

Market Movers: Gold Price Failed to Capitalize on Drop in US Yields

• The US 10-year Treasury bond yield fell nine basis points (bps) to 4.416%.
• US real yields, which often correlate inversely to bullion prices, dropped four basis points to 1.996%, which was a tailwind for bullion prices.
• US S&P Global revealed the Manufacturing PMI in February expanded by 51.6, up from 51.2, which exceeded forecasts. The Services PMI plummeted from 52.9 to 49.7.
• The University of Michigan Consumer Sentiment Index in February dipped from 71.1 to 64.7. American consumers’ inflation expectations for one year rose from 3.3% to 4.3% as foreseen, and for a five-year period, they were anchored at 3.5%, up from the 3.2% reading revealed in the previous month.
• The Federal Reserve’s Meeting Minutes from Wednesday revealed that Trump’s trade and immigration policies fueled concerns over rising prices.
• The World Gold Council revealed that central bank purchases rose more than 54% year-over-year to 333 tonnes following Trump’s victory.
• Money market Fed Funds futures priced in 50 basis points of easing by the Fed in 2025.

XAU/USD Technical Outlook: Gold Price Faced Resistance And Retreated

The price of gold remained upwardly-biased, yet the trend seemed to be exhausted. The Relative Strength Index (RSI) suggested that buyers were losing ground, as the RSI’s exit from overbought territory seemed to open the door for a retracement in bullion prices.

The first key support area to look at would be the $2,900 level. Once surpassed, sellers would target the Feb. 14 swing low of $2,877, followed by the Feb. 12 daily low of $2,864. Conversely, if the XAU/USD cross could surpass the $2,954 level, the first resistance would be the $2,950 threshold, followed by the $3,000 mark.

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