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Gold prices fell by 1.8% at the start of the week, driven by rising inflation concerns and a more hawkish stance from major central banks, despite unchanged interest rates in recent policy meetings. The decline reflects investor caution as central banks signal potential rate hikes to combat inflation, even as geopolitical tensions add to market uncertainty. The technical analysis highlights a bearish trend with the price remaining below a thick daily cloud, indicating continued pressure on the precious metal.
This development is significant for commodity traders and investors, as gold typically serves as a hedge against inflation and geopolitical risks. However, the current bearish momentum suggests that central bank policies may outweigh its safe-haven appeal in the short term. Traders should monitor upcoming central bank decisions and inflation data for potential reversals in sentiment.
For MENA investors, the decline in gold prices could impact portfolios with exposure to precious metals. Key levels to watch include the 200-day moving average and critical support/resistance zones. Geopolitical developments in the region, such as energy price fluctuations, may also influence gold's performance in the coming weeks.
