Gold rises amid trade, geopolitical tensions

Gold rose in early trading on Wednesday, as it continued to struggle to stay above the breached trend line on the four-hour timeframe. The yellow metal is currently awaiting further positive momentum to resume its main upward trend, heading towards $5239 then $5280. Conversely, if the price falls below the aforesaid trend line, it may test the support levels at $5092 then $5053.

Market Watch

The yellow metal rose due to the softer dollar and heightened safe-haven demand, amid uncertainty over U.S. tariffs and rising friction between Washington and Tehran.

Dollar index dropped by 0.1% during Wednesday trading, after rising 0.2% in the previous session.

US Starts Collecting Temporary New Tariff

The U.S. began collecting a temporary new 10% global import tariff, but the Trump administration is currently working on increasing the rate to 15%, a White House official said, sowing confusion over President Donald Trump’s tariff policies after last week’s Supreme Court defeat.

Trump initially signed an order on Friday for a 10% tariff to last 150 days to replace broad duties under an emergency law that was struck down by the Supreme Court, but on Saturday, he said he would increase the rate to 15%.

US-Iran Tensions Escalate

In terms of geopolitical escalation, Trump briefly set out his case for a possible attack on Iran, saying he would not allow the country to have a nuclear weapon.

Reuters sources indicate that Iran is approaching a missile procurement agreement with China involving anti-ship cruise systems that could pose risks to U.S. naval forces operating near Iranian waters.

US envoys Steve Witkoff and Jared Kushner are scheduled to meet with an Iranian delegation for a third round of talks on Thursday in Geneva.

Looking Ahead

Markets are awaiting later remarks from Federal Reserve members Michelle Bowman and Thomas Barkin, as any statements regarding interest rates could influence gold movements.