With Israel launching intensive air strikes, the gold outlook is tilted to the upside and is set to continue to hit record highs

Israel said it launched a large-scale airstrike on "Hezbollah targets in Lebanon" on September 23, hitting more than 1,600 targets. Israel continued to launch new airstrikes in various parts of Lebanon on September 24.

According to Agence France-Presse, sources on both sides confirmed that Israel carried out air strikes in southern Beirut on September 24. Israel announced a new round of attacks on "Hezbollah targets". Hezbollah said it had fired multiple rockets at Israeli military bases.

The Lebanese Ministry of Public Health said on September 24 that Israel's continued air strikes in Lebanon the previous day killed at least 558 people (including 50 children and 94 women) and wounded 1,835, the vast majority of whom were civilians.

According to the British Reuters report, on September 23 local time, Iranian President Pezehchiyan said in New York that Israel hopes to drag the Middle East into "all-out war" by provoking Iran to join the nearly year-long conflict between Israel and Hezbollah in Lebanon, and warned that the consequences are "irreversible".

Asked whether Iran would intervene in the conflict between Israel and Hezbollah in Lebanon, Mr. Pezehizyan did not elaborate, saying only: "We will defend any organization that defends its rights and interests."

Amid questions about whether Iran would retaliate for the killing of Hamas's politburo leader, Hania Haniyeh, in Tehran, the Iranian capital, in late July, Mr. Pezehizyan said, "We will respond in the right way at the right time and place."

Two Israeli officials and a Western diplomat told the US news site Axios that as fighting between the Lebanese militant group Hezbollah and the Israeli military escalated sharply, Hezbollah in recent days urged Iran to launch attacks on Israel, but Iran has so far exercised restraint.

A direct Iranian attack on Israel would significantly further destabilize the region and potentially draw the United States into the fray.

How to trade gold?

Valencia, an analyst at FX trading platforms, noted that the outlook for gold was tilted to the upside and was set to continue to hit record highs, although the rally appeared to be overdone. Traders are eyeing the $2,700 an ounce mark.

Valencia said the momentum is good for buyers, but the relative strength index (RSI) has turned overbought, so buyers should be wary of a possible pullback.

Valencia said traders could test $2,675 an ounce, followed by $2,700 an ounce, followed by $2,750 an ounce and then $2,800 an ounce if gold prices continued their rally.

(One-hour chart of gold prices)

On the other hand, Valencia added that if gold falls below $2,650 an ounce, it could test the September 18 high of $2,600 an ounce. The next key support to test will be the September 18 low of $2,546 an ounce, followed by the 50-day simple moving average (SMA) of $2,481 an ounce.