Gold is currently caught in a vice, squeezed by a toxic mix of fundamental and technical pressures. But what exactly is driving the selloff? Let's break it down. The primary triggers are twofold. First, the fragile US‑Iran ceasefire has shattered, extinguishing hopes for a diplomatic breakthrough. Second, and perhaps most critical, the Strait of Hormuz has been blocked once again—a move that sent oil prices soaring at Monday's opening bell. As a result, the greenback received a powerful boost as investors rushed into its safe-haven embrace. And here lies the problem for gold: the precious metal traditionally moves inversely with both crude quotes and the US Dollar Index (DXY). Consequently, the darker the Middle East crisis becomes, the heavier the burden on bullion gets.
Now, the focus is on the charts. Gold has decisively broken through the $4,800–$4,900 flat consolidation range—a move that carries serious weight. The pattern that has emerged is particularly compelling for bears. Prices cracked below support, bounced back to test the same level—now turned resistance—and then resumed their confident slide. Next logical target? The $4,700 support zone is firmly in the crosshairs.
The final recommendation:
— Sell gold at the current price, targeting $4,700 per troy ounce within one to two weeks.
— To limit potential losses in case bullion reverses course, place a Stop Loss order slightly above the resistance level, at around $4,820.
This content is for informational purposes only and is not intended to be investing advice.
