Why you should buy Gold

Why you should buy Gold despite price decline

There are many reasons why you should buy Gold. Amid growing geopolitical risks and tensions, buying Gold should be top on your list. Gold is and will always be a safe haven for any business person. Although Gold prices have been on the decline, it is still up 15% this year and can be sold during severe market disruptions as investors seek to cover losses in other markets.

According to the Daily Forex,  three consecutive trading sessions have seen spot gold prices undergoing a downward correction, with losses extending to the $2956 per ounce support level, near the free trading recommendations to buy gold from the $2950 support level. The gold price index is now recovering upwards around the $3015 per ounce level at the time of writing.

Reasons why Gold price is on the decline

The Gold price decline is due to President Trump’s tariff policies. Losses in gold bullion prices increased as investors sold their holdings to cover margin calls and take profits amidst broader market turmoil. While US administration officials appeared to have calmed markets, assuring that tariffs would not negatively impact the economy, analysts warned of slowing growth and rising inflation. Adding to tensions was Trump’s threat to impose 50% tariffs on China unless it reversed its retaliatory 34% tariffs on American goods.

Markets were also shaken by rumours of a possible 90-day suspension of the tariffs, which the White House quickly denied, leading to sharp volatility in stock markets recently.

Our Advice to Gold traders

We still recommend buying gold at every downward level, but without risk, and activating take-profit and stop-loss orders, while monitoring factors affecting the gold market to seize the best trading opportunities.

Meanwhile, over 50 countries have contacted the White House to begin trade talks. On Friday, China decided to retaliate by imposing a 34% tariff on all US imports, and other major economies are expected to follow suit. On the monetary policy front, traders now anticipate more US interest rate cuts by the Federal Reserve, with financial markets estimating a 55% probability of a cut in May and more than 100 basis points of easing by the end of the year. Just last week, investors expected interest rates to remain unchanged. However, Federal Reserve Chairman Powell warned that it was too early to determine the appropriate policy response.