Geopolitical tensions in the Middle East have driven safe-haven demand for Gold, but potential cooling in conflicts could reduce this demand.
Key Points
- Gold prices dip 0.41% today to $2,743.2
- A stronger U.S. dollar limits Gold demand for foreign buyers.
- U.S. election uncertainty adds volatility to Gold prices.
Gold Daily Price Analysis – 28/10/2024
Gold prices have experienced a pullback today, with the current price at $2,743.2, down 0.41% from the opening price of $2,749.2. Friday’s close saw Gold finishing slightly up by 0.21% at $2,754.6. Currently, Gold futures are slipping, and while prices showed resilience through last week, the yellow metal is starting this week on a cautious note as traders gauge global and economic cues.
Geopolitical Tensions and Safe-Haven Demand
Gold’s appeal as a safe-haven asset remains high, driven by heightened geopolitical tensions, particularly in the Middle East. Over the weekend, Israel carried out a missile strike on Iran in response to earlier attacks. This escalation initially triggered a wave of safe-haven demand, but the impact could be short-lived. Pepperstone’s Michael Brown notes that the response seems contained, suggesting that tensions may cool slightly, which could diminish Gold’s safe-haven bid if no further escalations occur.
Despite this possibility, markets remain on edge as any sudden developments could once again heighten volatility, encouraging investors to seek refuge in Gold. This sustained atmosphere of uncertainty keeps prices close to the critical $2,750 mark, though the metal has yet to decisively break through to the recent peak of $2,772.60 observed mid-last week.
The U.S. dollar’s recent strength is another key factor that applies pressure to gold. As the dollar gains, Gold—priced in dollars—becomes more expensive for foreign investors, thereby limiting demand. This trend could persist if the dollar continues to show resilience, especially given the slew of upcoming U.S. economic events expected to influence currency movements.
Political Uncertainty and the U.S. Election
The U.S. election on November 5 adds another layer of volatility to the Gold market. With the presidential race between Donald Trump and Kamala Harris projected to be closely contested, markets are increasingly jittery. Diverging fiscal policies between the two candidates, especially regarding taxes on total income and unrealized capital gains, may steer Gold prices in varying directions depending on market reactions and investor expectations for economic policy under the next administration. This political uncertainty adds an additional layer of risk, potentially supporting Gold prices as investors hedge against unpredictable outcomes.
Read More: Copper Price Forecast – How High Can Copper Price Go?
Key Economic Data and News to Be Released Today
Today, there is no high-impact economic data specifically slated to directly affect Gold’s movement. However, investors remain focused on the broader geopolitical developments and any preliminary statements ahead of the Federal Reserve’s monetary policy decision later in the week.
The absence of immediate economic data today may result in a relatively muted trading session, but with underlying volatility remaining due to the Middle East tensions and U.S. election concerns, Gold may see sporadic movements in response to news updates.
Gold Technical Analysis – 28/10/2024
Gold has been trapped in a range since Thursday, however, our bias is relatively to the upside. While the price relationship with the 200 intraday moving average is currently unclear, the RSI is diving to the oversold level.
The chart above shows that we may still expect a deeper pullback in today’s session to a key support level, before price resumes its bullish movement. Should price break through this current range to the upside, we may be looking forward to gold making another all-time-high before the week runs out.
Gold Fibonacci Key Price Levels 28/10/2024
Short-term traders planning to trade gold today should keep a close eye on the following key price levels for the day:
| Support | Resistance |
| 2736.1 | 2760.3 |
| 2728.5 | 2767.9 |
| 2716.4 | 2780.0 |
Risk Disclosure: The information provided in this article is not intended to give financial advice, recommend investments, guarantee profits, or shield you from losses. Our content is only for informational purposes and to help you understand the risks and complexity of these markets by providing objective analysis. Before trading, carefully consider your experience, financial goals, and risk tolerance. Trading involves significant potential for financial loss and isn't suitable for everyone.
