Gold opened this week’s trading on a firm note, as it hit a new record high at $2911, where the Bollinger Bands technical indicator is providing positive signals as the price moves above its middle line. Currently, the price is trading near the upper line of the indicator, aiming to stabilize above it to resume its bullish trendline on the medium term.

Meanwhile, gold is trading within a bullish channel, eyeing a breach of $2908, which is the first weekly resistance level. A sustained move above $2908 could lead to further gains towards $2954, noting that surpassing this resistance, with stability above it, would pave the way for the resumption of the key bullish trend toward $3000. 

On the downside, if gold fails to break through $2908, it may indicate a loss of momentum, potentially driving the price down to the weekly pivot point at $2840. If the price manages to break below the aforesaid point, it may push prices downward to weekly support levels at $2793 then $2725.

From a fundamental perspective, U.S. President Donal Trump decided to impose new tariffs of 25% on steel and aluminum imports into the U.S., thereby raising concerns of a global trade war.

As for economic data, investors are closely watch U.S. annual Consumer Price Index (CPI), which is expected to hold at 2.9% in January. If data exceeds expectations, this will indicate the presence of some inflationary pressures and may prompt the Federal Reserve to keep interest rates higher for a longer time.

Finally, investors will carefully consider comments from Fed Chair Jerome Powell as he testifies about Semi-Annual Monetary Policy Report before the Senate Banking Committee and the House Financial Services Committee on Tuesday and Wednesday.

Any comments about the possibility of cutting interest rates would be positive for gold, while citing uncertainty about the impact of U.S. tariffs could be negative for the yellow metal.