The US and Iran remain locked in a stalemate over control of the Strait of Hormuz, with ongoing exchanges of fire between the two countries. Meanwhile, US President Trump has stated that he has no intention of resuming negotiations with Iran and has claimed that the US military will soon strike Iranian enrichment facilities. The tense atmosphere surrounding Iran has not eased significantly, yet US crude oil prices have not surged. Therefore, while risk aversion towards gold remains low, the slower-than-expected rise in oil prices has increased the Federal Reserve’s expectation of not urgently needing to raise interest rates to curb inflation, thus supporting buying opportunities in gold at lower prices.

Therefore, if gold prices can establish a strong technical support level around $4,040 in the short term, a pullback to that level should present buying opportunities, providing upward momentum for gold prices.

A position can be established around $4,040, with a short-term target of $4,142 for profit-taking, and a stop-loss at $4,020.

Gold Price 1-Hour Chart:

Ferris Kwok

Chief Analyst
Success Finance Group

Email: ferris.kwok@successfn.com