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      Geopolitical Tensions as Catalysts, Algorithmic Trading as Key Drivers for Price Reversal

      Eva Chen

      Economic

      Commodity

      Summary:

      After closing in the positive territory on Wednesday, gold prices continued to rise on Thursday, currently trading around $3,380. Following the release of the US May inflation data, US Treasury yields plummeted significantly, and the ongoing weakness of the US dollar has helped to maintain the upward momentum of gold prices.

      Buy

      XAUUSD

      EXP
      PENDING

      3365.00

      Entry Price

      3450.00

      TP

      3329.00

      SL

      3441.38 +8.52 +0.25%

      --

      Point

      PENDING

      3329.00

      SL

      CLOSING

      3365.00

      Entry Price

      3450.00

      TP

      Fundamentals

      On Thursday, gold prices once again reversed the early morning decline in the European session and carried the bulls to challenge the previous week's high. After breaking through the minimum starting level of $3,360, gold is now in a neutral upward range, slightly below last week's high of $3,403.
      US President Trump issued another tariff threat on Wednesday, indicating that the initial market reaction to the positive Sino-US trade situation was fleeting. Additionally, the so-called escalation of geopolitical tensions in the Middle East has dampened investors' interest in high-risk assets, which is a boon for safe-haven gold.
      Meanwhile, after data released on Wednesday showed that the US consumer price index in May rose less than expected, investors increased their bets that the Federal Reserve would restart the interest rate cut cycle in September. This is seen as another factor supporting the price of non-yielding gold and helping to prevent further pullbacks yesterday.
      Geopolitical Tensions as Catalysts, Algorithmic Trading as Key Drivers for Price Reversal_1

      Technical Analysis

      Gold prices touched a one-week high in the Asian session on Thursday, extending Wednesday's nearly 1% gain. Weaker-than-expected US inflation data boosted bets on a Federal Reserve rate cut and a weaker US dollar, driving gold prices higher.
      However, with the significant pullback in the New York session yesterday, it seemed that gold prices were "once again" on track to decline when. In the final 4-hour close before yesterday's close, prices surged by $26 in just 20 minutes. This move was algorithmically driven, not from geopolitical tensions (which had been reported two hours before the price rise). After breaking through the minimum requirement of $3,360 for the bulls to turn, the technical dynamics have turned bullish. This means that the head-and-shoulders top pattern will continue to play out. Therefore, investors are preparing for a new round of gains.
      The bulls' immediate target is now $3,391, with the next target at $3,403, and the final target at $3,415.

      Trading Recommendations

      Trading Direction: Long
      Entry Price: 3365
      Target Price: 3450
      Stop Loss: 3329
      Deadline: June 27, 2025, 23:55:00
      Support: 3371/3360/3339
      Resistance: 3391/3403/3415
      Risk Warnings and Investment Disclaimers
      You understand and acknowledge that there is a high degree of risk involved in trading with strategies. Following any strategies or investment methodologies is the potential for loss. The content on the site is being provided by our contributors and analysts for information purposes only. You alone are solely responsible for determining whether any trading assets, or securities, or strategy, or any other product is suitable for you based on your investment objectives and financial situation.

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