On Tuesday (September 24), international gold prices reached new highs, with spot gold soaring by $28.59, an increase of 1.09%, closing at $2656.97 per ounce, and peaking at $2664.18 per ounce during the session. The rise in gold prices was mainly driven by two factors: the increasingly tense geopolitical situation in the Middle East and the sharp deterioration of consumer confidence in the United States. These factors heightened global investors' demand for safe-haven assets, while also leading to a decline in U.S. Treasury yields and a weaker dollar.
The conflict between Israel and Hezbollah in Lebanon escalated again on the 24th, with Israel conducting intensive airstrikes across multiple locations in Lebanon, causing significant civilian casualties. Meanwhile, Iranian President Pesakhizian issued a warning to Israel, stating that if the situation continues to escalate, the consequences will be irreversible. The market's concern over the outbreak of a full-scale war in the Middle East has intensified, directly boosting the demand for safe-haven assets, with gold's appeal as a traditional safe-haven tool significantly enhanced.
Apart from geopolitical factors, U.S. domestic economic data is also pushing gold prices upwards. The Conference Board's data shows that the U.S. Consumer Confidence Index for September plummeted, marking the largest drop since August 2021. The growing pessimism among consumers regarding employment and economic prospects has heightened market expectations of a U.S. economic slowdown, further increasing gold's safe-haven attributes.
With the ongoing turmoil in the Middle East and the Federal Reserve gradually easing monetary policy, gold prices are expected to continue rising. Some market strategists anticipate that gold prices may soon break through the $2700 per ounce barrier and even challenge the $2800 per ounce level in the coming months. Although the upward trend in gold may bring some adjustment risks, the overall trend remains bullish.
However, investors should also exercise caution regarding the current surge in gold prices, as technical indicators show that the Relative Strength Index (RSI) has entered the overbought zone, increasing the risk of a pullback. In the short term, the key support level for gold prices will be at $2650 per ounce; if it falls below this level, it may retreat to $2600 per ounce.
As global complexity increases, gold prices have already risen by 28% in 2024, with major investment banks generally optimistic about the medium to long-term prospects of gold. It is expected that in the foreseeable future, gold will remain an important choice for investors to hedge against risks.
