On September 21, the world gold price reached its highest level, surpassing the previous record of 2,600 USD set after the Federal Reserve (Fed) meeting on Wednesday.
According to the principles of technical analysis, the long-term, medium-term and short-term uptrend is likely to continue. Accordingly, the next peaks may reach $2,650, then $2,700.
According to the Relative Strength Index (RSI) on the daily chart, gold is not yet overbought, suggesting there is still room for gold prices to rise higher.
However, if the gold RSI reaches overbought levels, traders are advised not to invest long term.
World gold price reaches a new high level because the central banks around the globe will follow the Fed in loosening policies and cutting interest rates. Interest rate is lower will benefit gold.
Adding to the gold rally are growing geopolitical tensions in the Middle East. The White House has expressed deep concern about the situation, particularly the escalating conflict between Israel and Hezbollah. "We are concerned about the tensions and we are concerned about the potential for escalation," White House spokeswoman Karine Jean-Pierre said.
This convergence of economic and geopolitical factors has pushed gold prices to new highs. In just two weeks, gold futures have gained a whopping $120, with more than half of that gain occurring in the last two days alone. As of 5:15 p.m. EDT, the most-active December contract was trading at $2,647.10, representing a significant daily gain of $40.90.
