As traders speculate on upcoming Federal Reserve rate cuts, the gold price rally gains momentum, pushing prices to a new weekly high on Thursday. Despite the U.S. Dollar's recovery and a rebound in U.S. bond yields, gold remains a favored safe haven among investors. They are responding to ongoing uncertainties in Europe and anticipated monetary policy easing by the Fed, influenced by a slowing economy and subdued inflation pressures.
The surge in gold prices reflects increasing geopolitical risks, including Ukrainian drone strikes on Russian energy infrastructure and escalating Middle Eastern tensions. Political instability in Europe, notably worries about fiscal discipline under France's new government, further strengthens gold’s status as a reliable investment during turbulent times.
Financial markets are closely monitoring upcoming decisions from the Swiss National Bank and the Bank of England. These central banks' actions are expected to significantly influence the gold market, potentially adding to the gold price rally by increasing market volatility.
From a technical viewpoint, gold traders are focusing on overcoming resistance at the $2,344-2,345 level, as defined by the 50-day Simple Moving Average. Breaking through this barrier could drive prices towards the $2,387-2,388 resistance zones, aiming for the $2,400 mark. On the other hand, if gold falls below support levels near $2,320-2,318, it could trigger a downward trend, potentially leading to significant sell-offs towards the $2,200 threshold.
Explore the gold price rally driven by Fed rate cut speculations and geopolitical tensions. Learn how global events impact gold markets.
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