Gold prices slide as investors await further clues in volatile markets
Gold prices dipped in today’s trading as investors braced for future market signals amid the ongoing Israel-Hamas war.
Escalating conflict in Israel – following Hamas’ attack earlier this month – caused gold prices to spike last week as investors piled into safe haven assets.
This saw prices surge from $1,859.88 per ounce on Wednesday to a peak of $1,946.89 per ounce within two days of trading.
But prices eased in today’s trading, dropping from $1,932.45 per ounce to $1,918.75 per ounce.
Nevertheless, they remain well above trading levels at the start of this month, when concerns over a hawkish US Federal Reserve grappling with inflation and a robust dollar reduced investor appetite in gold.
Pierre Veyret, technical analyst at ActivTrades, said: “Price action hasn’t been very significant so far, and havens such as gold, silver, oil and treasuries have mostly held last week’s gains while global equities remain under pressure amid a ‘wait and see’ stance from traders.”
Carlo Alberto De Casa, market analyst, Kinesis Money also noted that the persistent increase of yields registered in bonds could reduce the need of further restrictive measures from the US central bank.
“We should also note that tensions in the Middle East, apart from boosting the demand for risk-off assets, are also increasing hopes that the US Central Bank will not raise interest rates in the two final meetings scheduled for this year. In other words, there are growing chances that the peak has been reached,” he said.
Alongside gold, silver has also enjoyed an uptick in trading following geopolitical concerns – with the metal rising from $21.75 per ounce to $22.83 per ounce o ver the same time period.
De Casa explained: “The market’s mood changed quickly and in just a few days, we moved from an oversold situation to an overbought picture. This could increase the chances of seeing some consolidation movements in the next few days, even if the positive trend should still be dominant for silver.”