Gold Eases From Record Highs as Profit-Taking Offsets Safe-Haven Demand

Gold prices retreated in early trading Tuesday as investors locked in gains following a rally driven by U.S. tariff uncertainty and escalating Middle East tensions. New York gold futures slipped nearly 2% to around $5,118 per ounce, as a rotation into U.S. Treasuries temporarily overshadowed traditional safe-haven demand for the metal.

Bullion had surged above $5,200 in the prior session, buoyed by fresh demand for hard assets amid mounting confusion surrounding President Trump's import tariff policies — a development that has added a significant layer of uncertainty to global markets. Despite Tuesday's pullback, the underlying bid remains intact. Gold holding above the psychologically critical $5,000 level signals continued institutional conviction, with analysts citing persistent geopolitical risk, growing questions over Federal Reserve independence, and an accelerating reallocation away from sovereign bonds and major fiat currencies as key tailwinds.

The 10-year Treasury yield dipped below 4.05% on concerns that rapid advances in artificial intelligence could disrupt the software and payments sectors — yet gold's rally stalled as the yield curve flattened and rate-cut expectations were pared back, removing a near-term catalyst for further gains.

Market volatility remains elevated. A 10% blanket global tariff took effect today, while the White House simultaneously prepared a formal order to escalate that rate to 15% — a move that has prompted European and Asian governments to consider suspending existing trade arrangements with Washington. Adding to the complex geopolitical backdrop, nuclear negotiations with Iran are scheduled to resume Thursday.

President Trump's State of the Union address tonight has markets on edge, with traders bracing for policy signals that could inject fresh volatility across asset classes. The speech comes just ahead of the next round of U.S.-Iran nuclear talks. "Both the U.S. and Iran seem to be delaying rather than seriously trying to negotiate a solid agreement acceptable to both sides," cautioned Robert Yawger of Mizuho Securities USA.

With tariff escalation, geopolitical flashpoints, and central bank policy all in play simultaneously, gold's near-term direction will hinge on whether safe-haven demand can reassert itself — or whether continued Treasury inflows keep a lid on the metal's next leg higher.

wishing you as always, good trading,