Gold plummets near 3% from all-time high on Trump's tariffs coming into effect

• US President Trump confirmed overnight that Mexico and Canada tariffs will go into effect on March 4.
• Panic hits markets with equities, cryptos and Gold selling across the globe, while safe-haven bonds are bid. 
• The precious metal is no longer considered to be a tariff safe haven for now although US yields are dropping off further. 

Gold's price (XAU/USD) sees losses accelerate going into Friday with a near 3% loss since it printed a new all-time high at $2,956 on Monday. The precious metal currently trades at $2,860 at the time of writing, after United States (US) President Donald Trump reiterated that tariffs for Mexico and Canada will start on March 4, while China will see an additional 10%, raising the total rates to20% on imports into the US. This dampens hopes markets still had for a possible delay in the implementation of these tariffs. 

Meanwhile, China is set to retaliate and it is ready to hit back at Trump's trade tariffs, raising the risk of a tit-for-tat trade war between the two big economies. "If the US insists on having its own way, China will counter with all necessary measures to defend its legitimate rights and interests," a spokesperson for the Chinese Ministry of Commerce said this Friday.

Daily digest market movers: March is just around the corner

• Gold ETF's (Exchange Traded Fund) are the sweet spot in China this year. Funds are swelling as the metal sets records, investors seek alternative assets, and local rules are tweaked to allow greater access. Onshore fund holdings increased by 17.7 tons in the first three weeks of February, close to the monthly record inflow of 20.9 tons set last October, according to data from the producer-funded World Gold Council, Bloomberg reports. 
• In early European trading, the risk-off mood this Friday is seeing deep losses with indices in Asia booking multiple percentage losses near their closing bell. European ones are facing losses of over 1% intraday. 
• The CME Fedwatch Tool sees chances for a June rate cut increase even further than Thursday. Odds are growing to a 71.8% chance approx for a rate cut against only 28.1% for keeping rates unchanged. 

Technical Analysis: Look for the stops

The signs projected earlier this week are being proven right on Friday, with a near 3% loss in the precious metal so far this week. However, the fundamentals still look good for more upside in Gold, with tariffs still being a main theme and not just a one-off event. Look to support levels such as $2,790 to be ready and buy back in large amounts to participate in the next rally. 

On the upside, the daily Pivot Point at $2,888 is the main level to look out for as resistance in the short term. That is just below the $2,900 big figure, and the daily R1 resistance at $2,909 is also in place. Thus, some chunky resistance makes recovering back to R2 resistance at $2,941 nearly impossible this Friday. 

On the downside, vigilant Bullion buyers will surely be happy to pick up some Gold at interesting support levels. The S1 support at $2,856 looks rather feeble for now. Look to S2 support at $2,835 for broad support, ahead of $2,800 round level and $2,790. Indeed, that last level should see many buy orders waiting to be filled. 

XAU/USD: Daily Chart