GOLD PRICE FORECAST: XAU/USD SURGE ON WAR HEADLINES
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Author: Amar – Technical Analyst

After updating weekly highs at $1950 on initial risk aversion, gold falls to $1930 during Friday’s Asian session. The yellow metal’s initial surge may be related to discussions of increased radiation and fears of Chernobyl 2.0 as Russia bombed Ukraine’s nuclear power plant. The traditional safe haven rose as much as 3.4% on February as Russia launched an all-out attack on its neighbor, but prices have since consolidated even as other commodities such as oil, wheat and carbon aluminum have accelerated. Geopolitical ups and downs tend to be fleeting; On average, gold prices tend to firm immediately after an event risk and deliver those gains within a month.

In addition to rising risk aversion due to geopolitical tensions, gold prices could continue to rise on the back of a dovish hawkish stance from the US Federal Reserve. Powell’s testimony has advocated a 25-basis point rate hike versus half a percentage point, coinciding with the Ukraine crisis and rising inflation. Meanwhile, the US dollar index (DXY) fell near 97.73 on Thursday despite optimistic initial jobless claims in the US. In the future, the US non-farm payrolls which will be release tonight might affect the price movements.

On a 15-minute timeframe, XAU/USD saw a strong bullish move after breaking out of the symmetrical triangle. It later solidified and showed the formation of an ascending channel. Now the precious metal has broken the ascending channel to the upside. and further prizes cannot be ruled out.