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Gold prices extended gains for a third consecutive session, surpassing $4,700 per ounce as traders anticipate a potential resolution to the Middle East conflict within weeks. ING analysts Ewa Manthey and Warren Patterson noted that geopolitical tensions remain a key driver, with investors seeking safe-haven assets amid uncertainty. The recent rally has pushed spot gold above critical resistance levels, though technical indicators suggest volatility may persist.
The move in gold is significant for commodity traders and investors, as it reflects broader market sentiment about global stability. A prolonged resolution to the Middle East crisis could weaken the US dollar, further boosting gold's appeal. Conversely, any escalation in tensions might trigger sharper price swings. Traders should monitor central bank policies and inflation data, which also influence gold's demand as a hedge against currency devaluation.
Looking ahead, the $4,700 level could act as a psychological barrier, with a break above it potentially targeting $4,850. However, a failure to hold above $4,650 may invite profit-taking. Investors should also watch for shifts in the US Federal Reserve's stance, as tighter monetary policy could dampen gold's momentum. The interplay between geopolitical risks and macroeconomic factors will remain pivotal in the near term.
