Gold prices tumbled Monday morning after a strong rally as the week ended trading for investors "trend to safe havens of yellow metal in light of geopolitical tensions in the Middle East and growing fears between Israel and Hamas.
However, since last week there has been no real escalation and ground invasion of Gaza, as Israel has claimed more than once, and American aircraft carriers in the eastern Mediterranean have resulted in no other parties interfering in the conflict. (So far) that's led to some downward corrections this week as well as 10-year U.S. bond yields rising again today limiting gold highs but remaining flat above the $1,900 per ounce cap.
The precious metal is likely to remain the focus of traders seeking to buy at declines, making areas of interest at $1910 and $1900 good areas for purchase.
Ultimately, since the Middle East war remains relatively confined within the region between Hamas and the entity so far, the price of gold may not rise as strongly as many expect.
If war spreads and other countries are involved, the impact of contagion is likely to support a sharp rise in gold prices.
