fell to $4,174 per troy ounce on Wednesday, hitting its lowest level since late March.
Pressure on the precious metal intensified following a new escalation of tensions in the Middle East. The United States launched strikes against Iranian targets after reports that a US helicopter had been shot down. This latest development has once again raised questions about the durability of the current truce and the prospects for a broader peace agreement.
Another key factor remains the situation around the Strait of Hormuz. Current shipping disruptions across the region continue to limit energy supplies and support high oil prices. These shocks, in turn, are fueling concerns that inflationary pressures across the global economy may persist for longer than expected.
Higher energy costs are prompting investors to reassess the monetary policy outlook of major central banks. Markets are increasingly pricing in a prolonged period of high interest rates and are no longer ruling out further policy tightening if inflation remains persistently high.
Investors' attention is now on upcoming US inflation data, which could provide important clues about the Federal Reserve's next steps. The US dollar is also receiving support from strong labor market numbers, which have reinforced expectations that the Federal Reserve could consider another interest rate hike before the end of the year.
As a result, the outlook for gold () remains broadly bearish.
Technical analysis
On the H4 chart, XAU/USD is trading within a consolidation range around the $4,393 level before breaking lower and extending its decline to $4,175. A corrective bounce towards $4,390 is possible in the short term, after which the market could resume its decline towards $4,238, with room for a further move towards $4,088.
The MACD indicator confirms the prevailing bearish momentum. Its signal line remains below the center line and continues to point firmly downwards, although early signs of a possible reversal are emerging.
On the H1 chart, the market broke below the $4,270 level and moved down towards $4,175. A corrective recovery towards $4,329 is possible, as a retest from below, before another decline towards $4,088. After that, a broader bounce towards $4,390 may develop.
The stochastic oscillator supports this scenario. Its signal line remains below the 20 level, but is starting to rise towards 80, indicating that a short-term corrective recovery may be gaining momentum.
Conclusion
Gold remains under significant pressure as geopolitical tensions, elevated energy prices and expectations of prolonged tight monetary policy continue to support the US dollar. While technical indicators suggest a short-term corrective rally, the broader outlook remains bearish unless market sentiment or inflation expectations change substantially.
By RoboForex Analysis Department
Disclaimer: Any forecast contained herein is based on the author's personal opinion. This analysis cannot be considered trading advice. RoboForex assumes no responsibility for trading results based on the trading recommendations and reviews contained herein.
