Gold surges above $2050 amid continued geopolitical tensions

Gold price surged due to geopolitical risks in the Middle East. Market expectations of Fed rate cuts in 2024 have boosted Gold’s appeal against a weakening Dollar. The ongoing geopolitical tensions increased risk aversion, with the US and UK retaliating against Iran-backed groups. The US Fed’s increasing odds of cutting rates by 170 basis points in 2024 have given precious metals a boost against the weakening dollar. The precious metal sticks to above the $2050 mark, at 2054.75.

The US economic docket will feature Fed speakers led by Governor Christopher Waller, Michael Barr, Michelle Bowman, and New York Fed President John Williams on Tuesday and Wednesday. Data-wise, the calendar will feature Retail Sales, Industrial Production, and the University of Michigan’s Consumer Sentiment.

Although Gold’s price has been sideways in the medium term, its technical outlook is neutral to upwardly biassed. For the market to remain positive, buyers need to surpass the peak of $2088.48 on December 28 in order to confront the $2100 mark, which will reveal the all-time high of $2146.79. Testing the $2000 mark may be possible if sellers push Gold’s spot price below the 50-day moving average, which is now at $2019.