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Published: 29 December 2025,07:40
Daily Market Analysis New
Key Takeaways:
*Dollar Weakness Persists – DXY slides to multi-month lows as markets price in the end of Fed tightening and a likely easing cycle in 2026.
*Gold’s Structural Rally – Bullion surges past $4,550/oz due to falling real yields, Fed easing expectations, central bank purchases, and ETF inflows.
Market Summary:
The U.S. dollar and gold markets are reflecting a clear macro theme: a shift away from restrictive monetary policy and rising concern over fiscal and geopolitical stability. The DXY has remained under pressure into year-end, sliding toward multi-month lows as confidence grows that the Fed’s tightening cycle is over. Softer inflation, confirmed by cooling CPI and PPI data and moderating labour momentum, has reinforced expectations that the next policy move will be easing. With investors focused on timing and depth of 2026 rate cuts, falling real yields have eroded a key pillar of dollar support.
Fiscal and political pressures amplify this trend. Despite optimistic rhetoric on tariffs and trade, investors remain uneasy about ballooning U.S. debt, persistent deficits, and heavy Treasury issuance. A weaker dollar raises concerns around debt servicing costs and foreign demand for U.S. assets, while geopolitical shifts including Trump’s potential role in Russia-Ukraine negotiations and mixed U.S. security signals have diminished the dollar’s safe-haven appeal.
These forces have strengthened gold’s appeal. Bullion surged above $4,550 per ounce since mid-week, driven by structural reallocations into hard assets. Falling real yields, expectations of further Fed easing, sustained central bank buying, and heavy ETF inflows reflect growing scepticism toward fiat currency stability, especially among emerging-market reserve managers.
Geopolitical tensions such as Russia-Ukraine, U.S. military actions in Nigeria, and Venezuelan crude frictions have further supported gold and other precious metals, with silver and platinum benefiting from industrial demand, supply tightness, and speculative flows.
After a near-vertical rally, gold shows early signs of tactical fatigue, with modest pullbacks amid thin Asian liquidity and profit-taking. Such pauses are typical and unlikely to undermine the broader bullish trend. Unless real yields rebound or the Fed signals hawkishly, near-term consolidation is likely corrective, while the dollar remains structurally vulnerable.
Technical Analysis
Gold has reinforced its bullish medium-term technical structure on the chart, following a sustained advance that has carried price decisively above its former consolidation zone. The metal has continued to respect a sequence of higher highs and higher lows, confirming that upside momentum remains firmly intact.
Price has recently pushed into the upper resistance band near the 4,520–4,560 region, an area that aligns closely with the 1.272 Fibonacci extension around 4,513. This zone represents a critical supply area where upside momentum is beginning to encounter friction. While price action remains constructive, the presence of long upper wicks and slower follow-through suggests emerging profit-taking pressure at elevated levels.
Momentum indicators continue to support the bullish bias, albeit with early signs of moderation. The RSI is holding in elevated territory near 70+, reflecting strong upside momentum but also signaling near-term overbought conditions. While this does not imply an immediate reversal, it increases the probability of consolidation or a shallow pullback before the next directional move. Meanwhile, the MACD remains above the zero line with a positive histogram, confirming that bullish momentum is still present, though the flattening of the histogram suggests upside acceleration may be slowing.
Resistance Levels: 4560.00, 5000.00
Support Levels: 4405.00, 4320.00
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