Gold shows no signs of slowing down
Rising tensions in the Middle East, particularly the recent clashes between Hezbollah and Israel, have increased uncertainty in global markets. Investors, seeking safe-haven assets to protect their capital, have naturally increased their exposure to the yellow metal.
The prospects of escalating geopolitical tensions in the Middle East have the potential to further boost demand for gold as a safe haven, creating a favorable environment for the yellow metal.
The unstable political situation in other parts of the world, including Eastern Europe, may also help support the price of gold in the short and medium term. The yellow metal continues to show a strong upward trend, supported by positioning above $2,630, but bulls are waiting for a close above $2,650 to increase their positions, with resistance at $2,660 representing the next juicy bullish target.
On the downside, a strong return of the bears could be seen after a clear close below $2,600, with support at $2,560 representing the only major obstacle before the yellow metal tests the nearest annual level set at $2,493.29.
According to experts, the rally is expected to continue, driven by the elections to be held in over 60 countries in 2024: investors are expected to keep buying what is undoubtedly the ultimate safe haven asset. In this regard, Kinsella explained that looking to the second half of the year, they have identified two potential factors that could lead to a price increase. First, the U.S. election campaigns will likely highlight the excessive debt levels of the United States: growing concerns about the country's fiscal sustainability will, in our view, be a positive factor for gold. Secondly, we believe that geopolitical risks will remain high and that any worsening of relations between major powers will give a bullish push to gold prices.”