Gold prices surged to new all-time highs, supported by rising geopolitical tensions after former U.S. President Donald Trump escalated rhetoric over Greenland. While the broader bullish trend remains intact, analysts warn that several near-term risks could trigger a correction. Key Highlights
  • Gold set new record highs following Trump’s escalation over Greenland
  • Bullish momentum remains supported by geopolitical uncertainty and the Federal Reserve’s dovish policy stance
  • Potential downside risks include geopolitical de-escalation, legal challenges to U.S. tariffs, and stronger-than-expected U.S. economic data
Fundamental Outlook Gold extended its rally as renewed geopolitical tensions boosted demand for safe-haven assets. Trump’s latest escalation over Greenland added to market uncertainty, reinforcing gold’s appeal as a hedge against political and economic risk. Similar dynamics were seen last year, when tariff threats lifted gold prices by increasing stagflation concerns. Higher tariffs tend to slow economic growth while pushing inflation higher—an environment historically favorable for precious metals. Looking at the broader picture, gold continues to find strong support from ongoing geopolitical risks and the Federal Reserve’s relatively dovish reaction function. However, in the short term, prices could face corrective pressure if tensions ease or if markets reprice interest rate expectations in a more hawkish direction. Risks That Could Trigger a Selloff Several catalysts could lead to a pullback in gold prices:
  • A de-escalation over Greenland, potentially led by Trump himself
  • Hawkish repricing of rate expectations driven by hot U.S. economic data, with next month’s Non-Farm Payrolls (NFP) report in focus
  • A U.S. Supreme Court ruling that goes against Trump’s tariff policies
Technical Perspective On the daily chart, gold broke into fresh all-time highs following the weekend escalation over Greenland. From a risk management standpoint, analysts suggest that a pullback toward the rising trendline could offer a more attractive risk-to-reward setup for buyers. However, a deeper correction would likely require one of the key downside catalysts to materialize. For now, gold’s long-term trend remains bullish—but investors should stay alert to shifting geopolitical and macroeconomic signals.