Gold Rally Extends Into Third Week

Safe-Haven Demand Supporting GoldGold prices are on track to end the week higher once again as ongoing uncertainty around the conflict in the Middle East keeps safe-haven demand well-primed. News that Israel launched its largest ground offensive into Gaza to date, overnight, is keeping geo-political risk-premium at highs ahead of the weekend. With traders still very mindful of the risks that the conflict spills out into a broader war in the Middle East, markets are stull highly sensitive to incoming headlines and while risks of escalation remain, gold prices look likely to remain supported near-term.Mixed US Earnings – Better US DataThe rally in gold prices comes amidst a mixed set of US earnings. Several big names have seen major stock falls in recent weeks with Tesla, Microsoft and Meta among the names to suffer on the back of tepid results. Yesterday, US advance Q2 GDP was seen coming in better-than-forecast, keeping the risks of further Fed tightening alive. However, news that business investment is falling, ties in with some of the weaker Q4 outlooks we’ve seen from some big players. Looking ahead today, focus will be on the latest core PCE data as well as revised UoM consumer sentiment data with any further US data strength likely to curtail the gold rally to some extent.Technical ViewsXAUUSD The rally in gold prices has seen the market breaking above the bear channel and above the 1973.51 level last. While above here, and with momentum studies bullish, the focus is on a further push higher and a continuation towards the 2069.41 level next. To the downside, 1871.04 remains key support on any surprise reversal lower.