Gold prices slipped on Tuesday in Asian trade as traders took profits following Monday’s surge, influenced by a stronger dollar and ongoing geopolitical tensions.

Monday’s Rally Fueled by Global Geopolitical Strain

• Ukraine-Russia Conflict: A deadly Ukrainian drone strike on Russian targets diminished optimism for peace talks, leading to increased safe-haven buying in gold.

• U.S.-Iran Nuclear Talks: President Trump’s announcement that Iran will not be allowed to enrich uranium further destabilized the Middle Eastern landscape, boosting the demand for gold.

• Uncertainty in Trade Relations: Rising worries surrounding potential U.S. tariffs and tensions with China pushed investors into safety assets, contributing to a 2% gain in gold on Monday.

Tuesday’s Modest Pullback

• Spot Price: Down 0.6% at $3,361.24/oz

• August Futures: Off 0.4% at $3,384.92/oz

Despite this dip, the price of gold remains firmly above early May levels due to ongoing tensions in the Russia-Ukraine conflict and U.S.-Iran relations.

Dollar Strength and Profit-Taking Pressures Gold

• The slight recovery of the U.S. dollar has led to profit-taking among investors after Monday’s gains.

• Broad metals are also seeing a sell-off, indicating a pause after the recent risk-averse driven rallies.

Outlook: Continued Safe-Haven Demand Anticipated

While gold’s short-term pullback is expected, the outlook remains bullish due to:

• Geopolitical Risks: Any escalation in Ukraine’s conflict or a breakdown in nuclear negotiations with Iran could spur fresh safe-haven purchasing.

• Trade Policy Uncertainties: With U.S.-China relations strained and additional tariffs looming, gold remains an attractive hedge against uncertainty.

• Bond Market Dynamics: Continued weakness in the global bond market sustains low real yields, supporting gold’s appeal.

By utilizing real-time commodity tracking and staying informed on key economic events, investors can navigatethe fluctuations in gold prices, strategically managing profit-taking while recognizing the consistent demand for this safe-haven asset.