Word of Caution for GOLD buying, Retail should wait for retest. Let us break down, factors which are influencing the price movements in upward directions.
Geopolitical Factors
Middle East Conflict (Israel-Palestine War): Ongoing tensions and conflict in the Middle East have heightened risk sentiment globally. Investors often turn to gold as a safe-haven asset during geopolitical instability, increasing demand and driving up prices. Uncertainty around the potential for broader regional escalations could continue to support gold’s upward momentum.
US-China Relations: Trade tensions, technological competition, and military posturing between the US and China remain a persistent concern. Any deterioration in relations may boost demand for gold as a hedge against market volatility.
Russia-Ukraine Conflict: Continued uncertainty from the Russia-Ukraine war is sustaining higher demand for safe-haven assets like gold. Sanctions on Russia, especially in the energy sector, also contribute to inflationary pressures globally, indirectly affecting gold prices.
US Debt and Fiscal Policy: The US government’s handling of its debt ceiling and budget deficits is closely watched. A looming fiscal crisis could spur fears of inflation or recession, increasing gold’s appeal.
Global Inflation Concerns: Rising inflation in major economies due to persistent supply chain disruptions and energy prices (partly due to geopolitical conflicts) pushes investors toward gold as an inflation hedge.
Summary
Geopolitical tensions (e.g., Middle East conflict, US-China relations) are driving gold’s safe-haven demand.
Inflationary pressures due to conflicts and supply chain issues also support higher gold prices.
These factors are contributing to volatility and increased interest in gold, with technical analysis helping traders navigate the current uncertainty.
