International spot gold opened sharply higher on June 15th, gaining over $60 to reach $4,275.60 per ounce, and exhibited a strengthening trend. This surge was influenced by news from Pakistan indicating that after intensive negotiations, the United States and Iran have reached a peace agreement. Both sides announced the immediate and permanent cessation of all military actions on all fronts, including operations in Lebanon. The formal signing ceremony is scheduled for June 19th in Switzerland. This development pressured oil prices to open 4% lower and caused the US Dollar Index to fall by 0.3%, thereby boosting bullish sentiment for gold. Furthermore, Iran's Supreme National Security Council issued a statement in the early hours confirming the formal agreement on a ceasefire understanding memorandum with the US. Former President Trump subsequently stated that an Iran deal had been reached, the Strait would be opened, and the blockade would be lifted.
In the short term, gold prices are expected to maintain strength based on this anticipation. However, the significant gap from the higher opening is likely to be filled. The formal signing of the memorandum of understanding is set for this Friday in Switzerland; therefore, there remains a risk of changes during this period. Even after signing, a subsequent 60-day negotiation period on nuclear issues will be initiated. Iran's Deputy Foreign Minister, Gharibabadi, also noted that the memorandum of understanding does not imply trust in the "enemy." Final agreement negotiations will take place within 60 days. He stated that if violations are observed, Iran will take measures independently. Consequently, until a final outcome is solidified, the current strength in gold prices should primarily be viewed as a temporary rebound.
Nevertheless, it is understood that the ultimate result of the geopolitical situation will be a ceasefire and long-term peace, which is now merely a matter of time. For inflation, this development is expected to support a weakening of expectations for Federal Reserve interest rate hikes. Therefore, in the second half of the year, gold prices are still inclined to shift towards a stronger trend.
Preliminary intraday trading level ideas are provided for reference. Specific entry and exit points should be confirmed with real account notifications:
Consider selling gold on a rebound to the $4,335-$4,345 range, with an additional sell position on a rebound to the $4,375-$4,385 range. Set a stop loss above $4,406, with targets at $4,230-$4,240, and a further target of $4,190 if the price breaks below that level.
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