Gold prices higher with an uptick in geopolitical risk having significant influence

Gold prices basis the most active February contract a a significant gain today of $20.10 or 1.06%, taking gold to $2683.

At the core of gold significant gain today was elevated risk resulting from the rapid collapse of Syria’s government. According to a Saxo Bank Note.” The rise comes as the rapid collapse of Syria's government supports safe-haven buying. Syrian President Bashar al-Assad fled to Moscow over the weekend as rebel forces took Damascus, the country's capital, just days after they overwhelmed Aleppo, Syria's largest city.”

Additionally, traders will focus and look for potential bullish support in gold prices if the Fed as expected cuts interest rates by 25 basis points this month. Although recent statements by Chairman Powell have focused on slowing the pace of rate cuts next week’s FOMC meeting will most likely announce ¼% rate cut on December 18.

After a six-month hiatus China’s central bank resumed bullion purchases.  Data released over the weekend showed the People's Bank of China's bullion holdings rose to 72.96 million ounces at the end of November, from 72.80 million in October. A combination of bullion buying and gradual lowering of interest rates globally could revive the bullish trend in gold prices, 

These events that we are focused on short-term does not even incorporate the other larger issues such as ongoing wars in Ukraine and Middle East.

Wishing you, as always good trading,