Gold prices added to recent gains on Wednesday, ending the session at levels last seen in early November, as geopolitical tensions persisted — boosting demand for investments considered less risky.
June gold rose $3.90, or 0.3%, to settle at $1,278.10 an ounce, with prices marking their highest finish since Nov. 7, according to FactSet data. Prices also closed above the metal’s 200-day moving average of $1,260.49 on Tuesday, pointing to an updraft developing in the precious commodity, according to technical analysts.
“Ongoing geopolitical tensions across the globe and heightened political risk in Europe have limited appetite for riskier assets this week, with global stocks now on the back foot,” said Lukman Otunuga, research analyst at FXTM, in a Wednesday research note.
A spate of geopolitical worries from tensions in Syria, after a U.S. airstrike in retaliation for an apparent chemical attack last week that strained relations with Russia, to mounting fears over North Korea, are unnerving investors, fueling demand for haven assets.
“After Trump’s punitive strike in Syria, it seems plausible that he is capable of doing the same in North Korea,” said Julian Phillips, co-founder of Gold Forecaster.
“Safe haven assets are now in play,” he said, adding that among those, gold is at “center stage alongside the less international silver.”
Gold is “firmly bullish on the daily charts, and further upside may be expected as anxiety accelerates the flight to safety,” Otunuga said.
Still, the global economy appears strong, tempering the market’s unease somewhat, with the head of the International Monetary Fund, Christine Lagarde, pointing to improving global growth on Wednesday.
For now, gold’s sister metal also gained. Silver climbed 4.6 cents, or 0.3%, to $18.30 an ounce.
Source: Market Watch