Friday’s Large Middle East Conflict-Induced Gain Pared Slightly

Gold is 0.7% lower in the Asia-Pac session, after closing 3.4% higher at $1,932.82 on Friday.

• Friday's surge marked the most significant increase in seven months, spurred by rising concerns about an escalation in the Israeli-Palestinian conflict, which drove a surge in demand for safe-haven assets.
• Today's market downturn may be attributed to reports of US President Joe Biden's potential visit to Israel in the coming days, coinciding with his administration's discussions with Iran through back channels aimed at containing the conflict.
• According to MNI's technical analysis team, a sustained breach above the $1,900 per ounce mark would expose a notable technical gap, with few significant resistance levels in sight until we reach the critical resistance point set at the September 1st high of $1,953.0 per ounce.
• It's worth noting that ongoing central bank purchases have continued to provide consistent support to the market, while holdings of gold in known ETFs recently rebounded from cyclical lows as the price of bullion rallied.