Gold price has been on the rise, hitting a two-week high near $2,450 on Thursday. This increase can be attributed to various factors that are supporting the price of Gold. One of the main reasons for the surge in Gold price is the dovish stance taken by the Federal Reserve, which has caused US bond yields to drop and put pressure on the US Dollar.
Moreover, geopolitical tensions in the Middle East have also contributed to the positive outlook for Gold as it is considered a safe-haven asset during uncertain times. However, despite these supporting factors, the Gold price is facing some resistance due to a generally positive risk tone in the market. This has led to some caution among bulls who are awaiting the US Nonfarm Payrolls report for further direction.
On the technical side, the Gold price seems to be favoring bullish traders, with key resistance levels being surpassed and positive momentum indicators on the daily chart. This suggests that the price of Gold could continue to climb higher towards the $2,468-2,469 region and potentially even reach the $2,500 mark. On the downside, immediate support is seen around the $2,437 level, with further support at $2,413-2,412.
It is important to note that Gold is not just a shiny metal used for jewelry, but also serves as a store of value and a hedge against inflation and depreciating currencies. Central banks around the world hold significant amounts of Gold in their reserves to support their currencies during turbulent times. In fact, central banks added a record amount of Gold to their reserves in 2022, signaling a growing interest in the precious metal.
Overall, the price of Gold is influenced by a wide range of factors, including geopolitical events, interest rates, and the strength of the US Dollar. Investors and central banks often turn to Gold during times of uncertainty, making it a popular safe-haven asset. As such, keeping an eye on these factors can help in understanding the movements in the price of Gold and making informed investment decisions.