Gold Prices Soar Amid Geopolitical Tensions: Technical Analysis Suggests $2,700 Target

Gold prices surged sharply on geo-political tension, hitting a high of $2,641. It is currently trading at around $2627

Ukraine has launched U.S.-made ATACMS missiles into Russia's Bryansk region, marking a significant escalation in the conflict. This action follows the U.S. government's approval for Ukraine to use these long-range missiles.

In response, Russian President Vladimir Putin has updated his country’s nuclear strategy, stating that any attack from a non-nuclear country against Russia would be considered a serious threat. Meanwhile, the U.S. has advised Russia to stop its “reckless rhetoric” and noted that there are no signs that Russia plans to use nuclear weapons in Ukraine.

Reports indicate that Ukraine successfully targeted a Russian munitions depot with these missiles for the first time, showing a major change in their tactics. Additionally, there are reports of North Korean troops aiding Russian forces, adding more complexity to the situation. Both Ukraine and Russia have also been conducting drone attacks, with each side claiming to have shot down several drones recently.

Markets eye FOMC member Barr, Cook, and Bowman's speech today for further movement.

Technical Outlook for Gold Prices

Currently, gold prices are situated above both short-term and long-term moving averages on the 4-hour chart, indicating a bearish trend. Immediate support appears at $2,600; if prices fall below this level, they could target further declines to $2,580, $2,560, $2,535, $2,500, and possibly $2,470. On the upside, minor resistance is noted at $2,640 (23.6% fib); breaking through this barrier could lead to upward movement toward $2,665, or even $2,700. Given the bearish indicators, a strategy of buying on dips around $2,578-$2,580 is recommended, with a stop-loss set at $2,550 and a target price of $2,700.