The price of gold experienced a significant decline yesterday, July 14th. The Asian session opened with a gap down, directly falling near the 4060 level. Subsequently, gold prices began to fluctuate, with a long position entered precisely at the 4050 range during the afternoon session, yielding modest gains into the European session. However, prices later started to retreat, and the long position was not held. The US session saw a sharp drop, with prices directly breaching the 4000 mark, reaching a low around $3986. Gold ultimately closed at $4000, forming a large bearish candlestick on the daily chart.
Following Tuesday's close, news has emerged of a formal notification to Congress regarding renewed conflict with Iran. US military forces conducted a "defensive strike" on military targets within Iran and announced the resumption of a maritime blockade. Concurrently, Iran's Revolutionary Guard contributed significant news—two UAE oil tankers were reportedly hit by Iranian cruise missiles in the Strait of Hormuz and lost operational capability.
Despite these events, the price of gold fell sharply. This is not "abnormal"; it is the current market's true "normal." The chain of events—geopolitical escalation → rising oil prices → heightened inflation concerns → market bets on Fed rate hikes → falling gold prices—has proven true once again. The intensification of Middle East conflicts has exacerbated market worries about rebounding inflation and the Federal Reserve maintaining high interest rates, placing sustained pressure on the precious metals sector.
Furthermore, hawkish voices within the Federal Reserve have grown louder. The market is not only pushing back expectations for rate cuts but is also pricing in the possibility of further hikes. The simultaneous strengthening of the US Dollar Index is further squeezing gold's room for appreciation. Tonight's key events are the release of the US June CPI data at 20:30 and a speech by Fed official Waller at 22:00. If the CPI reading remains high, gold prices may face further downward pressure.
From a technical perspective, the short-term decline in gold may see a temporary pause during the day. A rebound could occur, initially contesting the 4000 level. Resistance above can first be watched around 4020-25, followed by the 4040-50 zone. Stronger resistance remains in the trendline area of 4070-4100, but a rebound to this level is unlikely unless there are clear signs of easing in US-Iran tensions. During the day, expect repeated contention around the 4000-3990 support zone. If the price closes below 4000 today, a subsequent decline in gold would be merely a matter of time, with potential further tests of 3950 and 3900-3880 levels.
In summary, for those engaged in short-term trading, it is advisable to observe more and act less during the daytime session, or only attempt light short positions at resistance levels with strict stop-losses in place. Avoid heavy bottom-fishing at unconfirmed support levels like 3980, as this could lead to significant losses.
Around the time of the CPI data release tonight, it's best to hold minimal positions or stay flat and observe. Volatility and slippage can be extreme at that moment. It is prudent to wait for the data to be released and the market direction to become clearer before following the trend.
Recommended Trading Strategy:
Gold: Consider short positions around 4028-4030, with a stop-loss above 4040, targeting 3980-3950. If the price stabilizes above 4050, abandon the short position and consider long positions instead, looking upward sequentially.
Key Economic Data and Events to Watch Today: Tuesday, July 14
18:00 US June NFIB Small Business Optimism Index
20:15 US ADP Employment Change (Weekly, for the week ending June 27)
20:30 US June CPI (Year-over-Year, Unadjusted)
20:30 US June CPI (Month-over-Month, Seasonally Adjusted)
20:30 US June Core CPI (Month-over-Month, Seasonally Adjusted)
20:30 US June Core CPI (Year-over-Year, Unadjusted)
22:00 Fed Chair Waller Testifies at Hearing
Next Day 00:40 Fed Governor Barr Speaks on AI
Next Day 01:00 Fed's Goolsbee Participates in Conference
Next Day 01:30 Fed Governor Cook Delivers Speech
Next Day 02:55 Fed Governor Bowman Delivers Speech
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