Gold rebounded on Thursday after hitting a six-month low of $4,024, as the price fell sharply below the EMA (9) on the four-hour chart. The yellow metal is currently trading below the daily pivot point depicted at $4,133, where a break below the first daily support of $4,006 could trigger further decline towards the second support level of $3,940. On the upside, if the price reclaims the pivot point, it may rise towards resistance levels of $4,199 and then $4,327.
Gold markets remained under pressure as investors weighed escalating geopolitical tensions against shifting market fundamentals. Fresh exchanges of strikes between the United States and Iran heightened uncertainty across global markets, while Brent crude futures fell by 2.5% as traders reassessed supply risks and locked in profits after recent gains. Meanwhile, the U.S. Dollar Index edged lower but continued to hold above the key 100 level, reflecting persistent demand for the greenback as a safe-haven asset. Together, these developments created a mixed backdrop for financial markets, with investors closely monitoring geopolitical risks, energy prices, and monetary policy expectations.
Market Watch
U.S., Iran launches fresh strikes on each other
Tensions between the United States and Iran escalated further on Thursday as both sides exchanged a new round of military strikes for the second consecutive day, raising concerns over the collapse of the fragile ceasefire reached earlier this year.
The U.S. Central Command announced that American forces carried out strikes targeting Iranian military facilities, including air defense systems, radar sites, and command centers, in response to attacks against U.S. interests and military bases in the region.
In response, reports indicated that Iran launched missiles and drones toward U.S. military installations in Kuwait, Bahrain, and Jordan, stating that the operations were a direct reaction to recent American strikes.
The latest escalation follows the downing of a U.S. helicopter near the Strait of Hormuz in recent days, an incident that prompted Washington to conduct additional military operations against Iranian targets. Tehran, meanwhile, warned that it would continue to retaliate against any attacks on its territory or armed forces.
The renewed hostilities have also heightened concerns about the security of shipping routes through the Strait of Hormuz, one of the world’s most important oil transit corridors. Reports of potential Iranian threats to maritime traffic contributed to a rise in oil prices during Thursday’s trading session.
Analysts warn that the continued exchange of attacks between Washington and Tehran could broaden the conflict across the Middle East, particularly as diplomatic efforts to preserve the ceasefire and prevent a wider regional confrontation face increasing challenges.
Brent Crude Futures dropped by 2.5%
Brent crude futures declined by 2.5% during trading on Thursday as investors made profits following the strong gains recorded in previous sessions, while markets continued to assess geopolitical developments in the Middle East and their potential impact on global oil supplies.
Oil prices retreated after a sharp rally driven by concerns over possible supply disruptions in the Gulf region. However, market participants shifted their focus back to global supply and demand fundamentals, including inventory levels and expectations for worldwide economic growth.
Prices also came under pressure from a stronger U.S. dollar, which makes dollar-denominated commodities more expensive for holders of other currencies and can weigh on global demand for crude oil.
At the same time, investors continued to monitor tensions between the United States and Iran, with geopolitical risks remaining a key driver of energy market movements. Analysts noted that ongoing uncertainty could keep oil prices highly volatile in the near term.
Despite the decline, oil prices continue to find support from concerns over the security of major shipping routes, particularly the Strait of Hormuz, through which a significant share of global oil exports passes.
Dollar index eases slightly but holds above 100
The U.S. Dollar Index (DXY) edged lower during trading on Thursday but remained above the key 100 level, supported by continued demand for the U.S. currency as a safe-haven asset amid rising geopolitical tensions and ongoing uncertainty across global financial markets.
The modest decline followed recent gains in the dollar, as investors reassessed expectations regarding the Federal Reserve’s monetary policy outlook and the timing of potential interest rate cuts. Despite the slight pullback, the index’s ability to hold above 100 highlights the dollar’s continued strength against a basket of major global currencies.
Market participants are also closely monitoring recent U.S. economic data, which has pointed to continued resilience in both the economy and labor market. These developments have reinforced expectations that the Federal Reserve may maintain a cautious approach toward further monetary easing in the coming months.
In currency markets, the euro and British pound posted limited movements against the dollar, while investors remained focused on upcoming economic releases and official comments that could provide clearer signals regarding the future path of global interest rates.
Analysts believe that persistent geopolitical risks and strong demand for safe-haven assets could help support the U.S. dollar in the near term, even as some profit-taking emerges following its recent advance.
Looking Ahead
Market participants are now awaiting the release of the U.S. Producer Price Index (PPI) and the latest U.S. Initial Jobless Claims data, both of which could provide important insights into inflationary pressures and labor market conditions. The reports are expected to influence expectations regarding the Federal Reserve’s future monetary policy decisions, with investors closely monitoring the results for signals on the timing and pace of potential interest rate adjustments. Any significant deviation from forecasts could trigger increased volatility across currency, commodity, and equity markets.