Short-term sentiment is improving, and gold is expected to continue breaking through resistance levels.

Commodity

Summary:

With the easing of tensions in the Middle East, a significant weakening of oil prices, reduced inflation concerns, and the positive impact of the Federal Reserve's policy repricing, gold prices are expected to continue rising in the short term.

BUY XAUUSD

Close Time

CLOSED

4176.17

Entry Price

4350.00

3938.00

4345.32 -33.52 -0.77%

1738.3

Pips

Profit

3938.00

4351.52

Exit Price

4176.17

Entry Price

4350.00

Fundamentals

Regarding the Middle East situation, Qatari officials stated that mediators have made progress in their efforts to end the US-Iran conflict; both the US Treasury Secretary and Secretary of State have indicated that discussions surrounding the reopening of the Strait of Hormuz have progressed. Expectations of a sudden easing of geopolitical tensions have intensified, causing oil prices to weaken significantly. The negative correlation between gold and crude oil has become increasingly sensitive in this round of market activity; the decline in oil prices has led to reduced inflation concerns and easing expectations of a Federal Reserve interest rate hike, benefiting gold prices and causing them to rise.

Despite the significant uncertainties surrounding the Middle East situation and the potential setbacks in peaceful diplomatic efforts, which will test the upward trend in gold prices, the long-term costs of the conflict continue to accumulate. Neither side wants to become bogged down in a protracted war, and the impact of the conflict itself is gradually diminishing over time. Therefore, in the long run, we should remain optimistic about gold.

Furthermore, data from the world's largest gold ETF shows that net holdings have recently bottomed out and rebounded, and sentiment in the futures and options markets has warmed up, with improved holdings indicating that gold bulls are quietly accumulating positions, and there is a possibility that gold prices will break upwards.

Short-term sentiment is improving, and gold is expected to continue breaking through resistance levels.

Technical aspects

Looking at the 4-hour chart, XAUUSD has been oscillating within a range for more than a month, failing several times to break below the 4000 level. Now, the strong short-term breakout indicates that gold bulls are quietly accumulating positions and building momentum. The bottom has gradually been solidified, and the longer the consolidation lasts, the higher the probability of breaking out of the bottom, the more stable the structure, and the more considerable the gains.

In terms of trading strategy, it is not advisable to be overly bearish. You can try to go long when the price is around 4170, with a target of around 4350 and a stop loss below 3950.

Trading advice

Trading direction: Long

Entry slots: 4170

Target price: 3938

Stop-loss level: 4350

Downside support levels: 4112/4000/3950

Upward resistance levels: 4200/4350/4500

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