Gold resumed its near-term slide as tensions in the Strait of Hormuz escalated sharply, after Iran struck multiple vessels and set a UAE oil port ablaze. The developments triggered a fresh surge in oil prices and lifted the Dollar on safe-haven demand, reinforcing downside pressure on precious metals. Focus now shifts to the 4,400 Fibonacci support level, with a decisive break likely to open the path toward the 4,000 psychological handle.
The escalation followed the launch of the U.S. naval operation “Project Freedom,” aimed at escorting merchant ships through the Strait. Rather than easing tensions, the move appears to have provoked a direct response from Iran, intensifying maritime confrontation. With expectations growing that shipping disruptions could persist until August or beyond, markets are increasingly pricing in a prolonged supply shock.
Technically, the near term decline in Gold has resumed after a brief recovery, with rejection at 55 4H EMA (now at 4634.82) reinforcing bearish bias. Deeper fall is expected to 61.8% retracement of 4,098.45 to 4,889.24 at 4,400.53. Decisive break below this level would likely trigger an acceleration of the decline, opening the path toward a retest of 4,098.45 low and potentially extending toward 4,000 psychological level.
On the upside, a break above 4,660.21 would be needed to signal that a temporary bottom is in place. Until then, the bias remains to the downside, particularly if oil prices stay elevated and geopolitical tensions continue to drive inflation expectations higher.
