Gold Price News and Forecast: XAU/USD - US sanctions on Iran could spark a retaliation and risk-off

Gold drops to key support as Middle East fears subside

Crude oil and gold both fell further and stocks rallied after the US President made no mention of military action against Iran and called for peace. Donald Trump added that Iran "appears to be standing down" after Tehran hit air bases housing US forces in Iraq in retaliation to the killing of Iranian General Qasem Soleimani last week. However, it remains to be seen whether the situation will now de-escalate further or we see further response from Iran.

Following Trump’s speech, gold fell back to retest the highs from last year and key support around $1555, where it bounced back slightly. The buck-denominated safe-haven metal was also hit by a surging US equity market and a rebounding dollar. The latter found support on the back of a solid jobs report from the AFP. This showed private US non-farm payrolls rose by more than 200 thousand last month, some 40K more than expected. If this is anything to go by, then Friday’s official non-farm payrolls report could beat expectations again. Read more...

Gold: US sanctions on Iran could spark a retaliation and risk-off

The price of gold has fallen back to where it had started between the $1,550s and $1,560s, printing a low of $1,552.83 following the deescalating speech from President Donald Trump addressing the Iranian missile attack targeting a US military base in Iraq.

In early Asia, there had been rumours which transpired into confirmed reports of retaliation from Iran which played havoc on financial and commodities markets, sending gold through the $1,600 handle for the first time since April 2013. $1,611.34 was reached before the price action moved into a chop as markets started to discount a likely military retaliation from the US considering that there had been no US casualties and Iran had made clear to the US that there would be no further fury so long as the US did not retaliate. 

The price of gold started to deteriorate throughout the Asian and European markets as profits were taken by investors who now eagerly awaited a highly anticipated speech from President Trump which came at 11.30 ET where he delivered a balanced response to the attack. More on that here, but in conclusion, the US will respond by imposing further economic sanctions which those already imposed under Trump's administration have already crippled Iran's economy. Read more...

Gold Price Analysis: XAU/USD erases daily gains, trades sub-$1600/oz

The 2019 bull trend is rolling into 2020 with a bullish breakout. The level to beat for buyers is the 1560/1600 price zone.

Gold monthly chart

Gold is trading in an uptrend above the main monthly simple moving averages (SMAs). The metal is trying to have a successful breakout above the 1560/1600 price zone. If the bulls overcome this key resistance zone on a daily basis, the market might run towards the 1730 and 1900 resistance levels. Read more...