Gold Slips to $3,358 as Dollar Strengthens Post-U.S. Strikes on Iran Nuclear Sites
Gold prices edged lower on Monday, pulling back to $3,358 as global investors rushed into the U.S. dollar following a wave of U.S. military
Quick overview
- Gold prices fell to $3,358 as investors favored the U.S. dollar amid escalating geopolitical tensions following U.S. military strikes in Iran.
- Despite increased market risk, gold's performance was muted, with safe-haven flows shifting towards the dollar instead.
- Technically, gold is at a critical point, having bounced off a trendline but facing resistance at the 50-period EMA.
- Traders should monitor the $3,343–$3,350 zone for potential bullish or bearish setups based on price reactions.
Gold prices edged lower on Monday, pulling back to $3,358 as global investors rushed into the U.S. dollar following a wave of U.S. military strikes on key Iranian nuclear sites. The move added fuel to already tense geopolitical conditions, pushing the dollar index (.DXY) up 0.2% and placing pressure on gold, which becomes more expensive for non-dollar holders.
Despite the rising risk premium across markets, gold didn’t surge as expected. “The safe-haven flows have been skewed toward the dollar rather than gold this time,” said Tim Waterer, Chief Market Analyst at KCM Trade. “That’s caused an uncharacteristically muted performance from gold even in the face of conflict.”
President Donald Trump suggested the possibility of regime change in Iran, while senior U.S. officials issued warnings against retaliation. Meanwhile, Iran vowed to defend its sovereignty after 30,000-pound bunker-buster bombs were deployed above Fordow. As Israel and Iran exchange missile fire, oil prices briefly spiked to five-month highs, and equities in Asia posted mild losses—but markets remain cautiously stable for now.
Gold Holds Trendline but Struggles at EMA
Technically gold is at a crossroads. After bouncing off the ascending trendline at $3,343 price action was rejected at the 50 period EMA at $3,372. This was a bearish engulfing candle which is often a sign of further downside.
On the 2 hour chart a higher low is still in place so bulls are still defending short term support. But failure to get back above the $3,373-$3,400 zone will cap upside.
MACD signals are mixed: the histogram is stabilizing, and a bullish crossover may be underway, but it remains unconfirmed. Traders should wait for a strong bullish candle—such as a hammer or morning star—before assuming the bounce will extend.
Gold Trade Setup: Key Levels and Scenarios
Traders can consider two scenarios this week based on price reaction to the $3,343–$3,350 zone:
Bullish Setup:
- Entry: $3,345–$3,350 on bullish candle
- Stop-Loss: Below $3,319
- Target 1: $3,373 (EMA)
- Target 2: $3,400 (horizontal resistance)
Bearish Breakdown:
- A strong move below $3,343 with high volume could open the door to deeper support at $3,319, followed by $3,293.
Conclusion:
With geopolitical tensions high and sentiment shifting to safety gold’s next move will depend on how it reacts to the $3,343 trendline. If it holds we may see a push to $3,400. But if that line breaks more downside.
- Check out our free forex signals
- Follow the top economic events on FX Leaders economic calendar
- Trade better, discover more Forex Trading Strategies
- Open a FREE Trading Account
Related Articles
Sidebar rates
Related Posts
Save
Join 350 000+ traders receiving Free Trading Signals
