On Tuesday, June 17th, the analysis highlighted that a U.S.-Iran peace deal, leading to a de-escalation in Middle East tensions and lower oil prices, had cooled inflation expectations, thereby supporting a gold price rebound. However, expectations for the Federal Reserve to maintain a tight monetary policy continued to cap the upside for gold. Consequently, the suggested trading strategy was to watch for support at $4,300, followed by $4,280, and resistance at $4,369, followed by $4,400.
Subsequent price action saw gold open lower during the Asian session on Tuesday, finding support at $4,305 before staging a recovery. The price rose to encounter resistance at $4,354 during the U.S. session, then dipped to find support again at $4,313, ultimately consolidating in a relatively high range. Overall, gold recorded a modest gain on Tuesday, but the presence of clear overhead resistance prevented a further breakout, indicating limited near-term upside potential.
Market analysis suggests last week's rebound from lows extended into the start of this week, primarily driven by the announcement of a U.S.-Iran peace deal. This development, which includes the reopening of the Strait of Hormuz, pressured oil prices to fresh three-month lows. The resulting sharp drop in inflation pressure has led to a significant cooling in market expectations for a Federal Reserve interest rate hike, with the perceived probability falling from nearly 70% to around 52%. This shift has weighed on the U.S. dollar, providing a direct boost to gold prices.
On the daily chart, the rebound from last week's lows and the continued gains this week have alleviated short-term downward pressure. Key support levels to monitor include the psychological $4,300 level, where prices stabilized on Tuesday, and the $4,280 level, which served as a support base after Monday's gap higher and subsequent pullback. On the resistance side, focus remains on Monday's high of $4,369, followed by the $4,400 level, which also aligns with the daily Bollinger Band midline; a decisive break above this level could open the door for further gains. Technical indicators are showing signs of improvement, with the 5-day moving average nearing a golden cross, the MACD beginning to form a bullish crossover, and both the KDJ and RSI indicators pointing upwards, suggesting the possibility of further near-term recovery.
In summary, the U.S.-Iran peace deal has pressured oil prices lower, dramatically reducing inflation concerns and leading to a reassessment of Fed policy. This has weakened the dollar and directly supported gold. The recommended trading approach is to treat the market with a range-bound mentality, with key support at $4,300 and $4,280, and key resistance at $4,369 and $4,400.