Prices fell below $4,000 per troy ounce on Tuesday, hitting their lowest level in almost eight months. The precious metal remains under pressure amid expectations of further tightening from the Federal Reserve and continued uncertainty over the situation in the Middle East.
Since the beginning of June, gold has lost more than 12%, with quarterly losses estimated at approximately 15%. Markets continue to price in three Fed rate hikes for the remainder of the year, and the first could occur in September.
Investors are now turning their attention to the upcoming US labor market report, which could shape expectations about the Federal Reserve's next policy actions.
An additional layer of uncertainty comes from negotiations between the United States and Iran, which will resume today in Doha. Despite ongoing diplomatic contacts, prospects for a long-term agreement remain limited, and control of shipping in the Strait of Hormuz remains a key issue.
Technical analysis
On the H4 chart, the market is trading within a consolidation range around the $4,017 level and has fallen to $3,940. A corrective move towards $4,016 (a test from below) is expected, followed by a possible drop to $3,885, with room for a further move to $3,810. The MACD indicator confirms the current bearish momentum, with its signal line below the center line and pointing firmly downwards.
On the H1 chart, the market broke below the USD 4,017 level and went down to USD 3,940. A corrective bounce towards $4,016 (a test from below) is possible before a further decline to $3,885, with room for an extension to $3,810. The stochastic oscillator supports this scenario, with its signal line below 50 and pointing towards 20, indicating continued bearish pressure.
Conclusion
Gold has fallen below $4,000 for the first time in nearly eight months, extending its losses amid expectations of further Fed tightening and persistent geopolitical uncertainty. Markets are pricing in three rate hikes for the rest of the year, with the first likely in September, while negotiations between the United States and Iran in Doha offer limited prospects for progress given deep disagreements over shipping control in the Strait of Hormuz.
Gold has lost more than 12% since the beginning of June, with quarterly losses close to 15%. Technical indicators are pointing lower, suggesting a further decline towards $3,885 and potentially $3,810 in the near term.
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.
