Gold: A Safe Haven in a Context of Economic and Geopolitical Turbulence

A Perfect Storm in the Financial Markets

Last Thursday, the financial markets experienced a sharp decline, erasing the gains made the previous day. The selling pressure was particularly strong on semiconductor stocks, with major indices such as the S&P 500, the Dow Jones, and the Nasdaq recording declines of 1.37%, 1.21%, and 2.30%, respectively.

These indicators have exacerbated fears of an economic slowdown, pushing investors to seek refuge in safe assets. The yield on 10-year U.S. Treasury bonds fell below 4% for the first time since February, while the Dollar Index (DXY—a measure of the U.S. dollar's value against a basket of six major currencies, reflecting the dollar's relative strength in the foreign exchange market) slightly increased, signaling a move toward safety.

Gold: A Pillar of Security

In the face of this instability, gold recorded a notable increase, reaching $2,491 per ounce, a rise of 0.73%. This performance is the result of a multitude of factors, including uncertain U.S. economic forecasts and heightened geopolitical tensions. The recent escalation of conflicts in the Middle East, notably the assassination of the Hamas leader in Tehran, has intensified regional tensions, reinforcing gold's appeal as a safe haven.

Forecasts for gold remain bullish. According to Morgan Stanley, the precious metal could reach $2,600 per ounce by the end of 2024, supported by central bank purchases, individual demand, and global turbulence. Central banks, particularly those in developing countries, are significantly increasing their gold reserves, a trend expected to continue, thereby fueling demand.

Investment Strategies and Future Outlook

On August 2, gold showed technical signs of strength. Immediate resistance levels were around $2,469, with potential targets at $2,503. Investors might consider taking positions starting at $2,455, with protective stops at $2,433 to manage risks related to market volatility.

In conclusion, gold remains a crucial pillar for investors seeking to protect their portfolios against economic and geopolitical uncertainties. With optimistic forecasts and robust demand, gold is not only a refuge during crises but also a long-term appreciation opportunity. Savvy investors will continue to monitor this strategic asset while adjusting their positions based on market developments.