17 June 2025,06:16
Daily Market Analysis
17 June 2025, 06:16
*Gold consolidates above $3,400 as Israel-Iran tensions escalate
*Safe-haven flows surge on geopolitical risk repricing and Fed rate cut bets
*Dollar weakness and dovish Fed expectations underpin bullish gold outlook
Gold prices rallied to near two-month highs as rising geopolitical tensions and softer U.S. macro data bolstered safe-haven flows. The metal is consolidating just above the $3,400/oz level, underpinned by heightened market anxiety following Israel’s expanded airstrikes on Iranian nuclear and energy infrastructure. With Iran threatening retaliation and Israel declaring a national state of emergency, investors are bracing for a broader Middle East conflict—fuelling a sharp repricing of geopolitical risk and reinforcing gold’s crisis hedge appeal.
The rally also reflects growing expectations of a dovish pivot by the Federal Reserve, as recent U.S. inflation data came in below forecast and debt ceiling concerns re-emerged. Markets now assign a 60% probability of a rate cut by September, with Fed guidance at this week’s FOMC meeting poised to be a key catalyst. Any indication of lower forward rate projections or a softened tone from Chair Powell could drive real yields lower and send gold higher.
Meanwhile, the U.S. Dollar Index (DXY) is showing signs of fatigue, further lifting bullion through currency tailwinds. Investor flows into SPDR Gold Trust and resilient demand from institutional allocators suggest broader positioning remains constructive, though near-term overbought conditions and profit-taking risk persist. Overall, gold’s outlook remains bullish—anchored by asymmetric risks around central bank policy, geopolitical volatility, and weakening U.S. fundamentals.
GOLD, H4:
Gold remains buoyant above the $3,380 support zone, though recent price action has stalled below the $3,400 resistance barrier, suggesting hesitancy in extending the bullish momentum. The current structure shows gold consolidating within a shallow ascending channel, with upward traction slowing despite a supportive trendline holding firm. Price is sandwiched between the 0.5 and 0.618 Fibonacci retracement levels, signaling an inflection zone as markets await fresh catalysts from the Fed.
Momentum indicators point to waning bullish conviction. The Relative Strength Index (RSI) has slipped from overbought conditions and now hovers near the neutral 50 mark, signaling fading buying pressure and potential range-bound behavior. Meanwhile, the MACD has formed a bearish crossover below its signal line, underscoring softening momentum and raising the risk of a corrective pullback if $3,380 fails to hold.Traders remain cautious ahead of Wednesday’s FOMC decision, which may serve as a key directional trigger.
Resistance Levels: 3465.00, 3555.00
Support Levels: 3335.00, 3255.00
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