Conflict Escalates! Gold Oscillates Near $4,000

Tank

Summary:

Signs that the conflict in the Middle East may continue could put downward pressure on gold prices in the short term.

BUY XAUUSD

EXP

PENDING

3900.00

Entry Price

4600.00

3600.00

4026.03 +18.32 +0.46%

Pips

PENDING

3600.00

Exit Price

3900.00

Entry Price

4600.00

Fundamentals

The United States has launched airstrikes against Iran for the ninth consecutive night. Washington stated that Sunday’s airstrikes were intended to “punish” Iran, as this marked the first time U.S. military personnel had suffered casualties since hostilities resumed with the Islamic Republic of Iran. Iranian officials said the ceasefire agreement between Washington and Tehran has effectively been abandoned, raising the likelihood of further disruptions to the transport of critical energy resources through this narrow waterway. Air raid sirens sounded across Bahrain after Iran launched a new round of ballistic missiles and one-way attack drones at targets in Bahrain, Jordan, Kuwait, and Iraq. Signs that the conflict in the Middle East may persist could put selling pressure on gold prices in the short term.

Although U.S. consumer and producer inflation rates are showing signs of cooling, rising oil prices and expectations that interest rates will remain high for an extended period continue to weigh on the market. This, in turn, diminishes gold’s appeal as a non-yielding asset. According to data from the CME FedWatch tool, traders currently price in a probability of nearly 61.4% that the Federal Reserve will raise interest rates in September.

Technical Analysis

On the four-hour chart, the Bollinger Bands are widening downward, moving averages are diverging downward, and the MACD fast and slow lines continue to trade below the 0 line, indicating that the bearish trend remains intact. The RSI stands at 49, indicating strong market caution. On the daily chart, the Bollinger Bands are widening downward, and the moving averages are diverging downward. With the RSI at 41, market sentiment is predominantly bearish, and a test of the lower Bollinger Band is highly likely. However, gold is already approaching the bottom range; therefore, the recommended strategy is to buy on dips.

Conflict Escalates! Gold Oscillates Near $4,000_1

Conflict Escalates! Gold Oscillates Near $4,000_2

Trading Recommendation

Trading Direction: Buy

Entry Price: 3900

Target Price: 4600

Stop-Loss Price: 3600

Support Levels: 3900, 3600, 3500

Resistance Levels: 4200, 4300, 4600

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Conflict Escalates! Gold Oscillates Near $4,000

Risk Disclosure