As shown on the XAU/USD chart, the gold price is near $2,460 today, despite the 8th August candle opening around $2,385. This means that in just over three full trading sessions, the price per ounce has risen by approximately 3.3%. It is now only about 1.6% away from the psychological level of $2,500.

Bullish sentiment is being driven by rising geopolitical tensions. According to Trading Economics:

→ Israeli airstrikes on Khan Yunis on Monday killed at least 18 people, with several others injured.
→ Ukrainian forces last week breached the Russian border and are holding positions in the Kursk region.

Technical Analysis of the XAU/USD Chart

The gold price is forming a trading channel (indicated in blue), with:

→ the current rise pushing the RSI indicator into overbought territory;
→ the price reaching the upper boundary of the blue channel;
→ in similar past situations (marked by yellow circles), a pullback to the channel’s median has consistently occurred, but this does not guarantee the same outcome this time;
→ the $2,436 level may act as support for the current price, having shown resistance signs on Friday before being breached by bulls.

It is possible that the gold price could set a new all-time high, driven by volatility spikes in the coming days.

The current bullish sentiment may be supported by market participants positioning themselves ahead of key US economic news: the Consumer Price Index (CPI) report will be released tomorrow (at 15:30 GMT+3), and on Thursday (also at 15:30 GMT+3), Core Retail Sales data and unemployment news will follow.

According to Dow Jones Newswires, Axis Securities research analyst Deven Gaglani believes that “a break above the $2,483 high and a weekly close above this level would be a bullish signal, potentially pushing prices to $2,550.” He also suggests that news of easing inflation could lead to a rise in gold prices.

Start trading commodity CFDs with tight spreads. Open your trading account now or learn more about trading commodity CFDs with FXOpen.

This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.