The chart above shows that the gold market broke out of the strong cup-and-handle pattern in 2024. This breakout occurred after the bullish technical formations of the past decades. The 2024 outbreak caused a significant rally. The crucial breakout level was $2,075, and crossing this level opened the door to the $2,800-$3,000 region.
Fears of inflation, geopolitical instability in the Middle East, the conflict between Russia and Ukraine, US-China tensions and global monetary policy supported this outbreak. Central banks continue to buy gold as a reserve to diversify against the US dollar. This gold market breakout has resulted in consecutive positive quarterly candles. These candles emerged from the cup-and-handle pattern, indicating strong bullish momentum into 2025.
Most important factors for the gold price in 2025
Geopolitical tensions and market volatility
Now that gold has broken away from the crucial area in 2024, the geopolitical crisis will significantly impact gold prices in 2025. Protectionist policies and ongoing trade conflicts between the US, EU and China are expected to increase market volatility. These disputes could disrupt global trade flows and affect the prices of imported goods, further increasing inflation. Moreover, regional conflicts such as the war between Israel and Hamas and tensions in the South China Sea could intensify, causing investors to look to gold as a safe haven. These uncertainties will increase market volatility and could sustain higher demand for gold, especially during periods of heightened geopolitical tension.