Gold Price Forecast: XAU/USD rallies 1% as Middle East woes spark flight to safety

Gold price cheers risk-aversion on Middle East violence, briefly regains $1,850.
The US Dollar rebound limits the Gold price advance while US Treasury bond yields drop.
Gold price eyes a sustained rebound and critical US Nonfarm Payrolls data.

Dhwani Mehta FXStreet

Gold price is building on Friday’s rebound, briefly recapturing the $1,850 barrier early Monday. Escalating geopolitical tensions in the Middle East are spooking markets, as they seek safety in traditional safe havens such as Gold price, the US Dollar, Treasuries etc.

Renewed geopolitical risks came to the fore after the Hamas militant group in Gaza, Palestine, militarily attacked Israeli towns in an unprecedented move. In response, Israel launched airstrikes on Gaza and declared war against the Palestinian enclave of Gaza on Sunday.

Gold price is also capitalizing on worries that the geopolitical conflict could risk a fresh upsurge in oil price, threatening global inflation and economic outlook. Oil prices are already up over 4%, in a reaction to the Middle East conflict, which could threaten Oil price supply.

However, further upside in Gold price appears elusive, as the US Dollar also gains upside traction on increased safe-haven demand.

Meanwhile, a holiday in Japan is also helping exaggerate the moves in Gold price, as investors now look forward to the Middle East developments, Oil price movements and the upcoming US inflation data for fresh trading impetus.

At the time of writing, Gold price is adding 0.94% on the day to trade at $1,850, hitting a fresh five-day high at $1,856 in the opening trades.

Gold price technical levels to watch

XAU/USD

Overview
Today last price	1849.50
Today Daily Change	14.40
Today Daily Change %	0.79
Today daily open	1832.62

Trends
Daily SMA20	1887.46
Daily SMA50	1907.84
Daily SMA100	1927.22
Daily SMA200	1928.07

Levels
Previous Daily High	1834.94
Previous Daily Low	1810.51
Previous Weekly High	1849.16
Previous Weekly Low	1810.51
Previous Monthly High	1953.01
Previous Monthly Low	1846.37
Daily Fibonacci 38.2%	1825.61
Daily Fibonacci 61.8%	1819.84
Daily Pivot Point S1	1817.11
Daily Pivot Point S2	1801.59
Daily Pivot Point S3	1792.68
Daily Pivot Point R1	1841.54
Daily Pivot Point R2	1850.45
Daily Pivot Point R3	1865.97

Author

Dhwani Mehta

FXStreet

Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.

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