Gold prices held on to their resistance level of $2,050 despite the ongoing conflict in the Red Sea and the Middle East. However, the XAU/USD gold prices remained in the red on Tuesday as the conflict in the Red Sea escalated. A US-owned container vessel was struck by a missile attack off the coast of Yemen. The anti-ship ballistic missile came from Houthi-controlled areas of Yemen, according to the US Central Command.
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Gold Prices: Uncertainty in the Global Market Remains After Red Sea & Middle East Tensions Escalate
The uncertainty reflected negatively on the market as the Dow Jones index slipped 118 points on Monday. However, the Nasdaq index saw a brief rise of nearly 2.5 points in the day’s trade. The prices of gold held on to the charts dipping only briefly amid the ongoing tensions.
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However, today’s trade will decide if gold prices will sustain their current level or begin to dip in the indices. Traders remain fearful as the conflict in the Red Sea could make oil prices shoot up to $110 per barrel. Several commodity traders are opening long positions indicating that oil prices might also reach $130 per barrel.
If oil prices rise due to the Red Sea tensions, it could wreak havoc in the US and the global markets. The US dollar, gold prices, stock, and commodity markets could experience a bloodbath in the charts. The coming days will decide the movement of the market and it is advised to stay away from investing at the moment.
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While gold prices holding on to their resistance level at $2,050 is a good indicator of its strength, a downside could take it to $2,030. That’s a steep decline as tensions in the Red Sea could make gold prices dip further making investors remain in a sticky situation.