Gold Attracts Safe-Heaven Flows as Middle East Violence Flares Up
XAU/USD Analysis
Palestinian group Hamas launched a surprise and deadly attack on Israel, which retaliated with operation Swords of Iron. The flare up in the Middle East conflict boosts oil prices and sends gold higher as well, as the latter attracts risk-off flows.
XAU/USD managed to avoid fresh 2023 lows the risk aversion may give it the change to reclaim the EMA200 (at round 1,891). Daily closes above would pause the downside bias, but we are cautious around its ascending prospects and the upside looks unhospitable, with multiple roadblocks.
Despite today's surge, XAU/USD comes from a losing month die to the Fed's hawkish bias which benefits the greenback and Friday's strong NFPs support the higher-for-longer narrative. The commodity is in risk of new 2023 lows (1,804), although further losses towards and beyond 1,765 may prove elusive in the near term. The daily chart is also unfavorable since a Death Cross has formed (EMA50 < EMA200), which is often a precursor of sustained weakness.
Nikos Tzabouras
Senior Financial Editorial Writer
Nikos Tzabouras is a graduate of the Department of International & European Economic Studies at the Athens University of Economics and Business. With extensive experience in market analysis and a strong foundation in international relations, he brings a unique perspective to financial markets. Nikos emphasizes not only technical analysis but also on fundamentals and the growing influence of geopolitics on financial trends.
As a Senior Financial Editorial Writer, he delivers comprehensive and forward-looking insights across a wide range of asset classes, including equities, commodities, and currencies. His work explores how macroeconomic events, political developments, and global policies impact market dynamics, providing readers with a deeper understanding of both short-term movements and long-term trends.
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