Geopolitics and gold: The precious metal would struggle to continue its pace
|The surge in stock market volatility, as well as crises in Ukraine and the Middle East, have prompted investors to expand their exposure to the precious metal, which is regarded as a safe haven commodity, providing investors with a safe haven in times of uncertainty. According to the most recent reports on Ukraine, the United States intends to send around 8,500 soldiers on high alert in order to reinforce NATO forces in the region if needed. Russia, on the other hand, has denied all accusations that it plans to take over Ukraine.
On the other hand, the precious metal would struggle to continue its pace since interest rate rises seem certain in the coming months. When interest rates rise, so does the opportunity cost of owning gold, making it less tempting to investors. This will eventually result in sell-side pressure on gold, pushing its price down.
Below is the chat for the gold price which shows that the price is in a resistance zone. If it breaks above this zone, we are likely to see more higher highs for the gold price.
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