Gold price begins the new week on a lower note, reversing much of Friday’s advance to a multi-week high.
The gold price (XAUUSD) soared to a three-week high on Friday, at $1,932-1,933 in the aftermath of the escalating Israel-Hamas conflict. Which drove investors to seek sanctuary in conventional safe-haven commodities. In addition, anticipation that the Federal Reserve (Fed) is nearing the conclusion of its rate-hiking cycle. Boosted the non-yielding yellow metal.
In the face of higher US bond rates, failure to gain acceptance above the 200-day SMA drives some profit-taking.
Bulls, on the other hand, Beyond a theoretically critical 200-day Simple Moving Average (SMA),, unable to capitalize on the momentum. This, along with rising US Treasury bond rates, causes some profit-taking in the gold market. Resulting in a new leg down during the Asian session on Monday. However, the downside appears to be restricted in the context of a muted US Dollar (USD) price movement.
Traders may also choose to wait for new clues regarding the Fed’s potential rate-hike path, as well as crucial macroeconomic data from China. The world’s second-largest economy, before putting new directional bets on the Gold price.
Daily Digest Market Movers: The gold price may continue to draw shelter flows in the midst of the Israel-Hamas crisis.
The gold price rose about 3.5% on Friday and gained more than 5.2% for the week – the biggest since march. The intensification of fighting between Hamas and Israeli military boosted the safe-haven XAUUSD.
The Israeli military’s departure deadline for residents of northern Gaza has already passed.
The Israeli military has deployed armored vehicles and is preparing to undertake a large-scale ground attack in Gaza.
The Israel Defense Force (IDF) has stated that it is ready to launch a coordinated strike including air, ground, and marine troops.
Meanwhile, Iran has warned of far-reaching consequences if Israel’s bombing continues.
Following fire exchanges with the Iran-backed Hezbollah militia, Israel now confronts the threat of a new confrontation on its northern border with Lebanon.
The markets appear to be confident that the Fed will keep interest rates steady for the second month in a row. .
Consumer morale in the United States dropped in October, despite the fact that labor market growth may bolster consumer spending.
US bond rates remain elevated as investors continue to price in one more Fed rate rise by the end of the year.
On Monday, the failure to gain acceptance above the 200-day SMA leads some profit-taking around the Gold price.
