The temporary agreement between the United States and Iran has led to a noticeable easing of regional military tensions that lasted for months, significantly reducing market concerns about disruptions to shipping through the Strait of Hormuz. As a crucial global energy transit route, the Strait of Hormuz handles approximately 20% of the world's seaborne crude oil shipments. The restoration of normal passage through the strait implies a reduction in the risk of global oil supply tightness, prompting a significant decline in international oil prices.
The drop in energy prices has improved market expectations regarding the future path of inflation. Previously, escalating tensions in the Middle East had driven a rapid rise in oil prices, leading investors to worry that higher energy costs could trigger broader price pressures and prompt major global central banks to maintain a tighter policy stance for longer. With the emergence of the peace agreement, the market is reassessing its judgments on inflation and the trajectory of interest rates.
Market analysts believe that falling oil prices have diminished upside risks to inflation, reducing the necessity for major central banks to implement further policy tightening. XTB analyst Catherine Brooks pointed out that the peace agreement has placed significant pressure on oil prices, thereby alleviating market inflation concerns. This development comes just ahead of a series of key central bank meetings, altering market expectations for future monetary policy.
As a result, the gold market has experienced a significant rebound, with both spot gold and gold futures prices rising over 2%. As market fears of further interest rate hikes have diminished, the appeal of non-yielding assets like gold has improved, leading to renewed capital inflows into the precious metals market.
Market focus this week will shift to the Federal Reserve's interest rate decision. Investors will pay close attention to the Federal Open Market Committee (FOMC) meeting, which will be the first attended by new Fed Chair Kevin Warsh, hoping to glean more clues about the future direction of monetary policy from the policy statement and subsequent remarks. With the retreat in energy prices, previous market expectations for another rate hike later this year have cooled significantly. The Fed's future policy path is likely to become more dependent on subsequent inflation and economic data.
Looking at the daily chart, gold has staged a strong rebound after consecutive adjustments, but overall it remains in a recovery phase following the decline, with no clear trend reversal yet established. The price is still trading below key long-term moving averages, indicating that overhead resistance remains. Daily momentum indicators have shown improvement, but a further break above important resistance zones is needed to confirm a strengthening of the rebound. In the short term, focus is on the first resistance near $4400. An effective break above this level could pave the way for further tests of the $4680 and $4760 zones. On the downside, support levels at $4250 and $4140 need to be watched; a break below these could reopen the door for further adjustment.
From a 4-hour cycle perspective, the short-term rebound momentum for gold has clearly strengthened, with market sentiment improving alongside a weaker U.S. dollar and cooling rate hike expectations. However, the current rally appears more as a technical recovery following an oversold condition and has not yet broken free from the previous corrective structure. If the price can stabilize above $4400, bullish momentum could strengthen further. Conversely, if the rebound falters and key support zones are breached again, caution is warranted against the risk of a secondary decline due to profit-taking.
The temporary U.S.-Iran agreement has lowered the risk of a global energy supply disruption, driving a sharp decline in oil prices while easing market concerns about persistently high inflation and further central bank rate hikes. This has provided significant rebound momentum for gold. However, the Federal Reserve's future policy remains contingent on inflation and economic data performance. Gold's current price action is primarily a corrective rebound, with a new uptrend not yet confirmed. In the short term, investors need to closely monitor the outcome of the Fed meeting and whether gold can break through key resistance zones to gauge the potential for further upside.