Gold Rises, Risk Aversion Due to Escalation in the Middle East【October 30, 2023】

Fundamental Analysis

• The Israeli army conducts ground operations, the future of the Middle East situation is uncertain.
• Dollar/Yen falls due to the Bank of Japan’s policy meeting and risk aversion movements.
• Gold surpasses the significant USD 2000 mark, concerns over the escalation in the Middle East.

XAUUSD Technical Analysis

Analyzing the daily chart of gold prices. The uncertainty of the Middle East situation and the adjustment phase of the US stock market intensify investors’ risk aversion, leading to an influx of funds into gold, a safe-haven asset. From this situation, gold is likely to continue rising.

However, the daily RSI is 67, and the possibility of a temporary adjustment should be considered. The upcoming target prices for gold are seen at USD 2032, USD 2048, and USD 2081. As long as market unrest continues, the rise of gold will likely persist.

Day Trading Strategy (Hourly)

Analyzing the 1-hour chart of gold prices. It has temporarily fallen to USD 2000 since the morning, but this is considered a temporary adjustment. The levels at USD 1997 and USD 2000 are likely to serve as support lines. Also, there’s a possibility of a reversal around USD 1977, which corresponds to the 61.8% Fibonacci retracement.

For day trading strategies, one might want to set buy orders at USD 2000, USD 1997, and USD 1977 levels, target at USD 2032, and stop at USD 1970. However, be wary of sudden news related to the Middle East situation.

Support and Resistance Lines

The resistance line to be considered in the future is as follows

2048 USD – Past resistance line
2032 USD – Past resistance line
1997 USD – Upper limit of the recent range (support zone)

Market Sentiment

XAUUSD　Sell: 68% Buy: 32%

Today’s Important Economic Indicators

*Trading advice in this article is not provided by Milton Markets, but by Shu Fujiyasu Jr., a certified technical analyst.