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In-depth analysis of gold | Divergent war scenarios and gold prices: How to prepare for next week?
📉🔥📍Main phenomenon: Why did gold “fail” during the war?
This week, gold prices had their worst weekly performance since 1983, falling $525.56, or 10.47%, and more than 14% below this year’s highest level. At the same time, with the outbreak of war in Iran, rising oil prices, and rising inflation expectations, this should have been a decisive moment for gold, but the market did exactly the opposite. 💥
Behind this is a drastic change in market pricing logic:
Economic recovery weakens interest rate cut expectations
The war caused energy prices to rise, causing central banks around the world to reconsider interest rate policies. Federal Reserve Chairman Jerome Powell has made it clear that further easing of monetary policy will not be considered if inflation does not return to target. Market expectations for an interest rate cut this year quickly faded, and even a comprehensive rate cut is no longer expected by the market. 📉
US dollar recovers strongly
The U.S. dollar index has risen nearly 2% since the outbreak of the war, breaking the downward trend of previous months. Gold is priced in US dollars, and an appreciation of the US dollar directly leads to a fall in gold prices and weakens external demand. 💵
Focus and correct morale
Gold has risen sharply before, and this round of decline clearly shows the characteristics of profit-taking and cooling sentiment. Investors are starting to take a step back from the frenzy, waiting for signs that the worst is over. 🧠
📊 Technical Analysis: Bearish dominance, is rebound a trap for bulls?
Weekly chart
A huge bearish engulfing pattern resulted in a complete trend reversal to a downtrend with very limited rebound potential in the short term.
Key Resistance: $4,695 (Support/Resistance), reaching which level could present a selling opportunity.
Main support: $4,400 (previous low, a break above which could lead to a rise to $4,225).
Daily chart
A series of large bearish candles broke above all major moving averages and the moving average system is showing a downtrend.
MACD continues to expand, and although KDJ is considered oversold, the downward momentum continues.
There are no signs of a bottom forming and the price is moving within a standard weak downward channel.
short term structure
Resistance zone: $4615-4637 (strong resistance zone), $4735 is the mid-term boundary line.
Support area: $4,450 (weak support), a break above which could lead to a drop to between $4,300 and $4,200.
Trading pattern: There may be a “weak rebound → further decline” pattern next week, and it is unlikely that a technical correction will reverse the decline.
🎯Trading strategy for next week: mainly short selling on highs, supplemented by defensive counterattacks.
Basic idea: As long as the price cannot stay above $4,700, the downtrend will continue. Every spike represents a short selling opportunity. 🎯
🔥 Short Selling Strategy (Main Strategy)
Entry range: $4,615-4,630
Stop Loss: Above $4650
Target level:
First goal: $4,500-4,450
Target 2: $4,400 (breakout to $4,300)
🛡️Buy strategy (defensive counterattack)
Trigger condition: Price first reaches the $4400-4410 area
Stop Loss: Below $4380
Target level: $4500-4550 (natural rebound, avoid over-trading)
⚠️Risk management skills
Strictly control the transaction size by 10%-15%, enter the market gradually, and avoid large transactions.
Stop-loss orders should be used in all operations to protect against extreme swings caused by breaking news.
Pay attention to the $4,400 mark. If a double bottom forms, it may lead to a short-term rebound; if this bottom collapses, the possibility of a decline will increase.
💡 Conclusion and lead generation model
The market always swings between over-optimism and panic, what really sets us apart is a clear strategy and strict discipline. 💎
Next week is expected to be a fierce battle between gold buyers and sellers. If you are currently experiencing the following situation:
Stuck in position and don’t know how to adjust it
Feeling lost and without a clear plan
Want to keep up with the market but are having trouble without immediate alerts?
You are welcome to like, follow and comment:
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