Wall Street And Main Street’s Bullish Bias On Gold
Tuesday, May 20th 2025
Gold prices have remained in the spotlight this week, fueled by ongoing debates over tariffs and inflation. Despite some volatility, gold managed to hold firm above the $3,300 per ounce level, with mixed sentiment across Wall Street and a more bullish outlook from Main Street investors.
Weekly Gold Price Recap
The week began with spot gold trading at $3,239.76 per ounce. European traders triggered the first notable price move early Monday, pushing gold from $3,263 to $3,320 by mid-morning. North American traders then took over, driving the metal to $3,336 before Asian traders pushed it further to $3,382 in the first hours of their session.
By Tuesday, the yellow metal saw a steady climb, reaching the week’s peak at $3,431 per ounce before a wave of profit-taking brought it back down to $3,365. The Federal Reserve’s rate announcement and subsequent press conference had little impact, as gold remained within a tight $30 range throughout Wednesday.
Late Thursday, news of potential trade talks between the U.S. and China prompted a decline, with spot gold retreating to $3,277 per ounce. However, the dip proved to be an attractive entry point for investors, allowing gold to bounce back and close the week around $3,330 per ounce.
Wall Street Analysts Divided, Main Street Remains Bullish
latest gold survey revealed a balanced sentiment among Wall Street analysts. Out of 15 experts, 33% were bullish, 33% were bearish, and the remaining 33% anticipated sideways trading for the coming week.
SIA Wealth Management’s Colin Cieszynski expressed optimism, citing a weakening U.S. dollar as a tailwind for gold. “The U.S. Dollar continues to decline, providing support for gold. However, it will take a significant catalyst to break the current trading range,” he noted.
Adrian Day of Adrian Day Asset Management took a more cautious stance, warning that recession fears and potential tariff negotiations could temper gold’s rally. “Gold has shown remarkable resilience, but optimism around a tariff deal could slow momentum,” he said.
Meanwhile, Darin Newsom from Barchart.com emphasized the speculative nature of recent price action. “Gold ‘should’ go up, but technical analysis has become less relevant in the age of algorithm-driven trades,” he said, admitting that his bearish stance last week was premature.
The China Effect: A Key Factor
China’s role in gold’s price fluctuations was a central theme this week. According to RJO Futures’ Daniel Pavilonis, Chinese trade negotiations have created significant market uncertainty. “We’ve seen gold whipsaw between $3,200 and $3,500, driven largely by trade talk. If a deal is struck, gold could pull back to the 200-day moving average near $2,700,” he explained.
Pavilonis also highlighted the Federal Reserve’s delicate balancing act, as Chair Jerome Powell remains caught between recession concerns and maintaining economic stability. “If the Fed cuts rates, it could be seen as a political move, but raising rates could stoke fears of inflation,” he said.
Inflation Data and Economic Indicators on Tap
Looking ahead, traders will be closely monitoring a series of key economic reports. Tuesday’s U.S. CPI inflation data will offer insight into potential rate cuts, while Thursday’s release of the PPI, Retail Sales, and manufacturing surveys could further impact market sentiment.
Adam Button from Forexlive.com warned that any positive news on the tariff front could be negative for gold. “If China and the U.S. signal progress on trade talks, gold could lose some of its recent momentum,” he said, adding that gold’s current range between $3,200 and $3,500 could serve as a consolidation zone for the time being.
Consolidation or Breakout?
With Wall Street analysts evenly split and Main Street investors maintaining a bullish stance, gold’s path forward remains uncertain. For now, $3,300 appears to be a key support level, while $3,500 represents a formidable resistance point. The next round of economic data and trade negotiations may well determine which side of the range gold breaks through next.
