Gold Hits $1900 As Russia-NATO Tensions Boil

The Gold Index (XAU/USD) hit $1900 per ounce for the first time since June 2021 on Thursday, taking its on-the-day gains to more than 1.5% as geopolitical tensions between Russia, Ukraine and NATO simmer, stimulating demand for safe-haven assets.

Gold now trades more than 2.0% higher on the week, taking its two-week run of gains to nearly 5.0%. Fears of an imminent Russian military incursion into Ukraine have escalated in recent days.

Reports of shelling in the war-torn Donbas region of Eastern Ukraine on Thursday are sparking fears that Russia is looking to create a pretext for military action, as the country continues to amass troops near the Ukrainian border.

A positive technical background has coincided with the increased safe-haven demand for gold; XAU/USD broke above a key long-term pennant structure at the end of last week.

This week it fell back to the $1850 area to test the old long-term pennant and, promisingly for the bulls, found strong support. The bulls will now likely target a move above $1900 and towards the mid-2021 highs in the $1915 area.