In midday trading on Monday, gold prices remained relatively stable while silver prices saw a decline. The ongoing geopolitical unrest in the Middle East has created a safe-haven demand, supporting both gold and silver markets as traders approach the week with heightened caution. As of the latest reports, December gold futures were down $2.20, trading at $2,665.60, while December silver futures fell $0.454 to $31.94.
Market sentiment reflects increased risk aversion, particularly following reports that a 4.5 magnitude earthquake in Iran might have resulted from an underground nuclear test. The earthquake’s epicenter was near Aradan City and occurred at a shallow depth of 10 kilometers, according to the U.S. Geological Survey. This comes amid Israel’s ongoing military actions in Lebanon and threats of retaliation against Iran in response to missile attacks, raising concerns that Israel may target Iranian oil infrastructure, which has contributed to rising oil prices.
In other developments, China’s gold reserves remained unchanged for the fifth consecutive month in September, totaling 72.8 million troy ounces. However, the value of these reserves increased from $182.98 billion in August to $191.47 billion by the end of September. The World Gold Council anticipates that global central banks, which had ramped up gold purchases in 2022-2023, will likely reduce their acquisitions in 2024 but maintain levels above those seen before 2022. This shift is partly due to a pause in buying by the People’s Bank of China, which had been active for 18 consecutive months until May.
In the broader financial markets, the U.S. dollar index remained stable. Nymex crude oil prices rose to a six-week high, trading at around $77.00 per barrel. The yield on the benchmark 10-year U.S. Treasury note hovered around 4.1%.
From a technical standpoint, December gold bulls currently hold a strong near-term advantage. The next key price target for gold bulls is to close above the significant resistance level of $2,800.00. Conversely, bears are aiming to push prices below solid support at $2,600.00. Key resistance levels for gold are identified at the overnight high of $2,679.20 and Friday’s high of $2,690.60, while support is seen at the overnight low of $2,657.30 and $2,650.00. Wyckoff’s Market Rating for gold is 8.5.
You Might Be Interested In
- Gold Prices Decline Following Strong US Nonfarm Payrolls Report
- Time for Switzerland to Reconsider Gold Reserves
- Gold Demand Surges Amid Unprecedented Price Rally
