Gold may hit $2,450 if Israel-Lebanon conflict escalates, analysts predicts

On July 29, 2024, the price of gold started at ₺2,540 per gram and $2,395 per ounce. Friday’s closing prices showed a limited upward trend.

Analysts highlight that if the Israel-Lebanon tensions escalate into an open conflict, gold could reach $2,450 per ounce. This week, the Federal Reserve’s interest rate decision and U.S. non-farm payroll data are crucial for gold prices.

Geopolitical risks drive prices up

• Gold prices are rising due to increasing geopolitical risks in the Middle East.
• Israel has been massing troops at the border, with intermittent clashes observed.
• Several countries are advising their citizens against traveling to Lebanon.
• The likelihood of conflict between Israel and Lebanon has made gold, a safe haven asset, more attractive.

Gram gold prices

• On the open market, gold prices began at ₺2,540 per gram.
• In the Grand Bazaar, prices ranged between ₺2,555 and ₺2,595.
• Early trades showed a 0.5% increase compared to Friday’s close.
• Quarter gold: ₺4,235
• Half gold: ₺8,460
• Full gold: ₺16,875

Ounce gold prices

• In global markets, ounce gold prices remained close to $2,395.
• Prices rose above $2,400 during overnight trading.

Market indicators

• The Dollar Index (DXY) is around 104t the beginning of the week.
• U.S. 10-year Treasury yields start the week at 4.17%, having dropped from 4.3% last week, a positive signal for gold.

Key levels to watch

• $2,400 is a psychological level for ounce gold, with $2,380 as support and $2,412 as resistance.
• For gram gold, ₺2,525 is support and ₺2,568 is resistance.

Middle East tensions

• Analysts warn that efforts for a cease-fire in Gaza, coupled with new conflicts in the Middle East, could elevate geopolitical risks.
• In such scenarios, gold prices might surge to $2,450 per ounce.

US economic data

• This week, the Federal Reserve’s interest rate decision and U.S. non-farm payroll data are vital for gold prices.
• A potential interest rate cut by the Fed in September is already priced in, but statements from Fed Chair Jerome Powell will provide more insights.
• Continued weak employment figures could strengthen the case for a rate cut.