The ongoing situation in the Middle East continues to weigh on gold prices.

Summary:

Escalating conflicts in the Middle East, rising inflation and interest rate hike expectations continue to suppress gold prices, and the battle to defend the $4,000 level has begun.

Sell XAUUSD

End Time

CLOSED

4040.00

ENTRY

3962.00

TGT

4100.00

4058.64 -1.59 -0.04%

6000

Points

Loss

3962.00

TGT

4100.58

CLOSING

4040.00

ENTRY

4100.00

Fundamentals

As the conflict between the US and Iran escalates, Trump announced the restoration of the naval blockade against Iran and plans to impose a 20% toll on all goods passing through the Strait of Hormuz. The situation in the Middle East has suddenly escalated, oil prices have been hit and surged by more than 9%, and inflation concerns and expectations of a Fed rate hike have intensified again, all of which have put strong pressure on gold.

Federal Reserve officials are increasingly turning hawkish, with the market now pricing in a 75% chance of a September rate hike, and US Treasury yields have risen sharply, highlighting the market's pricing in short-term rate hike pressure. In the short term, gold bulls still lack sufficient support, with the Middle East situation acting as a Damocles' sword hanging over gold.

Technical aspects

The ongoing situation in the Middle East continues to weigh on gold prices.

Looking at the 1-hour chart, XAUUSD has broken down again, breaching the 4000 level once more. Once gold firmly breaks below 4000, it will open up new downside potential. Although there was some rebound during the day, the strength was weak, and the bears clearly have the upper hand. With the release of important data tonight, the downward trend may resume, potentially falling further towards 3960 in the short term. Of course, the possibility of entering a new phase of accelerated decline cannot be ruled out.

The main strategy is to sell on rallies. You can try to sell short when the price rebounds to around 4040, with a target of around 3960 and a stop loss above 4080.

Trading advice

Trading direction: Short

Entry slots: 4040

Target price: 3960

Stop-loss level: 4100

Downside support levels: 4000/3960

Upward resistance levels: 4040/4080

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