On June 26th, gold prices experienced a pattern of dipping and then recovering. The Asian session opened with some declines, allowing short positions below the $4,000 level to capture modest gains. The price began to rebound during the US session, reclaiming the $4,000 mark and reaching a high near $4,045. The rally did not continue into the late session, and gold ultimately closed at $4,026, forming a small bullish candlestick on the daily chart.
Key Market Drivers for Friday, June 26th
The release of the PCE data last night showed a year-on-year PCE of 4.1% and a core PCE of 3.4% for May. The 4.1% PCE reading marked the first time it had broken above 4% in over three years, which in theory should be bearish for gold. However, the market's reaction—a dip followed by a rise—reveals the secret lies not in "what the number is," but in "how the number relates to expectations." The core PCE of 3.4% was exactly in line with forecasts, not exceeding them. This data meeting expectations precisely became the "lifeline" for gold's rebound.
Nevertheless, the Federal Reserve's underlying hawkish stance persists, placing a cap on the rebound's potential. Gold is a non-yielding asset, and high interest rates equate to higher holding costs. This current move represents an oversold correction rather than a trend reversal, with significant selling pressure expected in the $4,045-$4,060 zone. Additionally, a suspected attack by Iran on a Singapore-flagged cargo ship near the Strait of Hormuz caused a brief spike in oil prices of about 2%. Recurring geopolitical tensions mean some safe-haven capital remains willing to buy gold around the $4,000/$3,960 levels, providing a "soft cushion" below and preventing a one-sided collapse in the short term.
Technical Analysis Perspective
From a technical standpoint, although gold experienced a rebound overnight due to the temporary influence of US data, the extent of the recovery remains insufficient to alter the overall weak structure. However, the short-term trend may have temporarily halted its decline and entered a phase of low-level consolidation. For the day, resistance is initially observed near the upper boundary of the hourly chart's range around $4,050. Support is first monitored around the $4,020-$4,010 area; a break below this level would shift focus to a test of the hourly chart's lower range boundary near $3,970.
Overall Outlook and Strategy
In summary, yesterday's PCE data, by "not being worse," helped gold stem its losses and rebound above $4,000. However, expectations for Fed rate hikes and a strong US dollar continue to exert downward pressure. Friday's trading is inherently more volatile, and with the $4,000 level having just been "regained," the battle between bulls and bears remains intense, offering little certainty. Key focus will be on potential direction shifts stirred by the evening's Michigan data and speeches from Fed officials. A breach below $3,960 would signal further downside for gold.
Consequently, the following intraday trading strategy is suggested:
Gold: Operate within the range of $3,970-$4,050. Set a stop-loss of $10 and a take-profit target of 60-70 points. If the price breaks below $3,960, consider entering a short position on any minor rebound, targeting the $3,910-$3,900 area.
Major Economic Data and Events for Friday, June 26th, 2026
22:00 (GMT+8) US Final June University of Michigan Consumer Sentiment Index
22:00 (GMT+8) US Final June One-Year Inflation Expectations
23:30 (GMT+8) Speech by Federal Reserve Bank President Neel Kashkari
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