Gold prices rise amid growing Middle East tensions

UAE gold prices

Amidst escalating geopolitical tensions in the Middle East, gold prices have surged in the UAE, reflecting investors' flight to safety amidst uncertainties stemming from recent events in Israel. The Dubai Jewellery Group reported an uptick in gold prices, with 24K trading at Dh288.5 per gram at the market's opening on Friday, a slight increase from the previous day's closing price of Dh288.25 per gram. Similarly, 22K, 21K, and 18K gold prices also saw modest gains.

At 9:25 am UAE time, spot gold was trading at $2,384.14 per ounce, marking a 0.17 percent increase, as investors sought refuge in the precious metal amidst growing concerns over regional stability. The uptick in gold prices comes in the wake of recent explosions in Israel and reports of heightened tensions between Iran and Israel, with Iran allegedly shooting down three drones over Isfahan in response to purported Israeli drone activity.

Commenting on the surge in gold prices, Vijay Valecha, Chief Investment Officer at Century Financial, attributed the increase to escalating conflicts in the Middle East, which have bolstered gold's status as a safe-haven asset. Despite sustained high US interest rates, geopolitical uncertainties have outweighed their impact on gold prices, driving investors towards the precious metal as a hedge against volatility.

Valecha highlighted the significance of upcoming US economic indicators and statements from Federal Reserve officials in shaping gold prices in the near term. Key indicators such as Unemployment Claims, the Philly Fed Manufacturing Index, and Existing Home Sales, along with insights into the Fed's interest rate trajectory, are expected to influence market sentiment and gold's performance moving forward.

From a technical perspective, gold is currently trading above its pivot point, indicating a bullish trend. Valecha noted that gold prices are forming an upward channel and consistently displaying bullish candles above the moving average. In terms of support levels, immediate support is seen at $2,362, followed by $2,355.

As geopolitical tensions continue to escalate in the Middle East, gold is likely to remain in focus as investors seek safe-haven assets to mitigate risk. The precious metal's role as a store of value and a hedge against uncertainty makes it an attractive option for investors navigating volatile geopolitical landscapes.

In conclusion, the surge in gold prices in the UAE reflects the broader trend of investors flocking to safe-haven assets amidst escalating geopolitical tensions in the Middle East. As uncertainties persist, market participants will closely monitor geopolitical developments and economic indicators for insights into gold's trajectory in the coming days and weeks.