On Wednesday, July 22, the spot gold price experienced a sharp and sudden increase during the Asian trading session. The price is currently hovering around $4,123 per ounce, marking a significant intraday gain exceeding $45. This upward movement follows a trading session where the price briefly retreated to the psychological level of $4,000 per ounce before rebounding, fueled by a resurgence in global safe-haven demand.
The primary catalyst for the rally in gold is the rekindled market hope for a de-escalation in US-Iran tensions. A Reuters report cited a senior Iranian official stating that Tehran had received a 10-day ceasefire proposal from mediators. These efforts are aimed at preserving a previously agreed-upon interim arrangement.
Technical Analysis of Gold's Price Action
From a daily chart perspective, the price remains positioned above its key moving averages. While the MACD indicator had previously shown signs of waning momentum, the influx of safe-haven capital is helping to restore bullish strength, suggesting a bias towards a choppy upward trend. On the 4-hour chart, the price completed a technical correction near the $4,000 level before rebounding, forming a short-term structure of volatile recovery. The moving averages are gradually turning upwards, indicating renewed buying interest. The RSI indicator has rebounded from lower levels, showing an improvement in short-term momentum. Overall, the recommended trading approach for gold is to focus on buying during pullbacks.
Gold Trading Strategy
Long Position Strategy: Consider entering long positions in the range of $4,111 to $4,109. Set a stop loss at $4,087, with target levels near $4,150 and $4,180.
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