The recent geopolitical developments between the United States and Iran have triggered significant volatility in the gold market, leading to a dramatic two-day price swing.
On Wednesday, following a series of military strikes between the US and Iran, the price of gold plunged to a low of $4,067, approaching the key psychological level of $4,000. However, a sharp reversal occurred on Thursday as news emerged that the two nations were moving towards a potential agreement, propelling gold to a high of $4,219. This represents an intraday swing of approximately $152, illustrating the market's rapid response to shifting macro narratives.
ATFX analysis of minute-level charts shows the initial news broke at 01:15:17 Beijing Time, reporting that Iran had finalized a draft agreement to be relayed to Washington via Qatar. At that moment, gold was trading quietly around $4,074, with little market reaction. The significant move began at 01:28, when the price surged from $4,081 to $4,169 within 15 minutes, a gain of about $90. This rally was later confirmed by a statement from the US President at 01:29:42, announcing the cancellation of planned strikes and the intention to sign an agreement with Iran, with details to be announced shortly. The sequence highlights a slight lag in the dissemination of news through some channels.
From a technical perspective, examining the daily chart reveals potential support levels. The low of $4,098 formed on March 23rd and the recent low of $4,023 on June 11th could establish a double-bottom pattern if the latter level holds. This could provide a foundation for a technical rebound. However, the overall trend for gold remains weak, with moving averages still pointing downwards. The prospect of a US-Iran deal, while positive in the short term, is not yet finalized, and expectations for a sustained gold rally should be tempered with caution.
The broader interest rate environment also presents a headwind. An analysis of US Treasury yields shows an upward sloping curve from one-month to one-year maturities. Notably, the spread between the one-year yield (3.84%) and the one-month yield (3.66%) is only 18 basis points, which is less than a typical Fed rate hike increment. This suggests the market is potentially pushing back expectations for the timing of the Federal Reserve's first rate cut, with some forecasts pointing to the first quarter of 2027. This dynamic continues to exert pressure on the US dollar, influencing gold's valuation.