CoinTelegraph reports—Amid the sudden halt in U.S.-Iran military actions, oil prices plunged over 6% on Monday, while gold opened higher and touched $4,096. The easing of risk-off sentiment supported gold’s rebound, but the probability of a Fed rate hike this year remains high at 92%. Combined with skepticism over Iran’s sincerity regarding the ceasefire, gold’s short-term upside is constrained, with the $4,000 level serving as a key observation point; the long-term safe-haven rationale remains unchanged.
CoinMarketCap APP reports — The U.S.-Iran military confrontation has suddenly paused, triggering immediate volatility across global markets. On Monday, July 27, international oil prices opened sharply lower; U.S. crude plunged over 6% to $83.10 per barrel, easing inflation concerns; spot gold opened more than $40 higher, rising 1% to a peak of $4,096.63 per ounce, and is currently trading around $4,085 per ounce, up approximately 0.8%. Meanwhile, U.S. stock index futures rose across the board, with S&P 500 futures up 0.65% and Nasdaq futures up 1.2%. This chain of reactions follows the Trump administration’s decision to create room for diplomatic negotiations, alongside Iran’s simultaneous pause in retaliatory actions. However, whether gold’s brief rebound can be sustained still depends on genuine de-escalation in the Middle East, clarity on the Fed’s policy path, and market re-pricing of inflation and interest rates.
U.S. Ambassador to the United Nations, Mike Waltz, stated on Sunday, July 26, that after two consecutive nights without airstrikes on Iran, President Trump decided to create some room for diplomatic efforts with Iran. The Iranian military also simultaneously announced a pause in retaliatory strikes against U.S. allies in the Middle East, citing that the U.S. had ceased attacks for two consecutive nights. Previously, after 13 days of consecutive U.S. strikes on Iran, operations were halted from late Friday night, and the Iranian Army stated that Tehran had suspended its response actions.
Although the two countries reached a ceasefire agreement in April and signed a memorandum of understanding for 60 days of peace talks in June, recent conflicts have reignited over control of the Strait of Hormuz. Iranian military spokesperson Mohammad Akrami emphasized that Iran’s actions are retaliatory in nature, and if the U.S. continues its military campaign, particularly through airstrikes, the situation will escalate further. The suspension of military operations has renewed hopes for the resumption of U.S.-Iran negotiations. Prior to this, Iran had again closed the strait after hostilities resumed, and reports indicate that six vessels attempting to transit were detained within the past 24 hours.
Meanwhile, internal signals from the U.S. side are also worth noting. CNN, citing Pentagon sources, reported that military action against Iran has been “suspended,” while The New York Times reported that ammunition shortages and the risk of regional conflict escalation have prompted the U.S. to put its escalation plans on hold. However, Ambassador Waltz firmly denied any shortage of supplies, stating that U.S. forces have all the resources they need and criticized the leak of such information. An Iranian senior official told the media that Tehran’s position is clear—respond to attacks with attacks; if the U.S. stops its strikes, Iran will also cease its actions, and this message has been conveyed to the United States.
However, a senior Iranian source noted that Tehran is more skeptical than optimistic about this pause, viewing it as a tactical adjustment rather than a genuine shift in intent, given Iran’s extensive history of being deceived by the United States. According to multiple media reports, Trump made the decision to pause following last Friday’s meeting, during which Chairman of the Joint Chiefs of Staff General Cain and several senior military and political advisors expressed concerns about next steps; Vice President Vance had reservations about continuing the attacks, and U.S. Central Command Commander General Cooper recommended halting the bombings, as the operation’s effectiveness had nearly reached its limit.
This pause directly alleviated market concerns regarding supply terminals in the Strait of Hormuz. The decline in oil prices not only cooled inflationary worries but also eased pressure on the Federal Reserve to raise interest rates, with the US Dollar Index opening and closing lower, falling as much as 0.23% to 101.22. As a traditional safe-haven asset, gold quickly rebounded under the dual influence of falling oil prices and a temporary easing of geopolitical tensions, reclaiming the $4,050 level.
Last Friday, spot gold rose slightly by 0.1%, closing at $4,053.29 per ounce, up 0.9% for the week. Independent metal trader Tai Wong noted that despite persistently rising yields, gold and silver appear to be finding support around $3,950 and $55, respectively. While a sharp escalation in conflict could still push prices below these levels and trigger stop-losses, gold seems poised for a rebound; a clear signal from the Fed next week that it will hold rates steady would be supportive for gold prices. Analysts at ING believe that gold’s recent strength appears largely driven by bargain buying and short-covering, following a significant pullback from record highs earlier this year. High oil prices and rising yields may cap any further upside, making $4,000 a key level to watch in the near term.
The latest Kitco News weekly gold survey shows that Wall Street is bearish or uncertain about the short-term outlook for gold prices, while Main Street sentiment has improved after gold once again held the $4,000 support level.
Adrian Day, President of Adrian Day Asset Management, said that while cautiously optimistic, the situation is not yet resolved, as the Federal Reserve may still raise rates, while the Asian giant’s economy slows and implements stimulus measures. Encouragingly, over the past seven days, gold prices have remained largely flat—declining initially before rebounding—despite escalating tensions in Iran, rising oil prices and a stronger dollar, and increasing expectations of a Fed rate hike before year-end. When any asset or market fails to decline in the face of negative news, it is a bullish signal.
Rich Checkan, President and Chief Operating Officer of Asset Strategies International, believes two forces are at play: oil prices above $100 per barrel and a strong support level at $4,000. After multiple tests of the $4,000 support, he believes it will hold, but as long as tensions in the Middle East keep oil prices and inflation concerns elevated, gold will struggle to rise significantly.
Lukman Otunuga, Head of Market Analysis at FXTM, noted that Brent oil briefly surged above $100, putting significant pressure on gold. This chain reaction has now taken hold: higher oil prices intensify inflation concerns, increase bets on Fed rate hikes, strengthen the dollar, and push up Treasury yields—all of which pose downside risks for gold, which offers no yield. He warned that while technical forces may drive a modest price increase, geopolitical tensions could limit any sustained recovery in gold.
Forex senior market strategist James Stanley is more optimistic, believing that the $4,000 level has held up well so far, with demand emerging during tests below. Large participants with a long-term horizon—such as central banks, pension funds, and hedge funds—will view this as an opportunity. With a Federal Reserve meeting coming up next week and stock markets beginning to show signs of strain, he expects Powell to try to support President Trump by sounding less hawkish than many anticipate. In the long term, tightening or balanced budgets are not on the horizon in the near term, so the bullish case for gold remains intact even amid this temporary counter-trend backdrop.
Colin Cieszynski, Chief Market Strategist at SIA Wealth Management, holds a neutral view. He believes gold has already experienced a significant rally, and many war-related factors have been priced in; however, the drop from $5,500 to $4,000 has not fully alleviated all war-related concerns. Prices remain elevated, and there is concern this could lead to rate hikes. Inflation data has been lagging, and if oil prices continue to rise, inflation could rebound in one to two months. Based on this, the dollar may begin to strengthen, creating headwinds for gold. Currently, gold is stabilizing at a middle ground and needs three to six months to consolidate. He does not expect significant volatility in the gold market around the upcoming Fed rate decision, noting that it is peak summer and volatility has already been high; the Fed does not want to stir up trouble. Gold is likely to remain within its recent trading range of $3,960 to $4,170 over the coming week.
This week, global financial markets will face multiple challenges. The Federal Reserve will announce its interest rate decision on Wednesday, with markets widely expecting the federal funds rate to remain unchanged at 3.50%-3.75%. Due to a 27% surge in oil prices this month, which has intensified inflation concerns, markets have priced in approximately 44 basis points of rate hikes by year-end. Investors will closely monitor the FOMC statement and Chair Powell’s press conference for clues on the future policy path. JPMorgan Chase’s Chief U.S. Economist, Michael Feroli, expects the Fed to hold rates steady at this week’s meeting, but anticipates at least two committee members will vote against it with a hawkish stance, as some officials are growing impatient with inflation remaining persistently above target.
According to data from the CME FedWatch tool, the probability that the Fed will hold rates steady in July is 63.7%, while the probability of a cumulative 25-basis-point hike is 36.3%. By September, the probability of holding rates steady is 19.6%, with a 55.2% chance of a cumulative 25-basis-point hike and a 25.2% chance of a cumulative 50-basis-point hike. By December, the probability of holding rates steady drops to just 7.8%, with a 30.9% chance of a cumulative 25-basis-point hike and a high 61.5% chance of at least a 50-basis-point hike; the probability of at least one rate hike this year stands at 92.2%. These figures indicate that although the upcoming meeting this week may hold rates steady, the pressure for rate hikes this year remains significant and could limit gold price gains.
On the economic data front, the U.S. will release June durable goods orders, July consumer confidence index, first-quarter GDP estimate, June PCE price index, and personal income and spending data, as well as the final July University of Michigan consumer sentiment index. These data points will provide the market with the latest assessment of economic resilience and inflation trends. The Bank of England is expected to hold rates steady at 3.75% on Thursday, the Bank of Japan is anticipated to maintain its rate at 1% on Friday, and the eurozone will also see a batch of key data releases. With multiple factors converging, they are expected to dominate market movements.
The sudden pause in U.S.-Iran military actions has provided the market with a brief reprieve. The decline in oil prices has eased concerns over inflation and supply disruptions, allowing gold to stabilize and rebound above $4,000, while stock index futures have also strengthened. However, Iran’s skepticism regarding the U.S. commitment to a ceasefire, the potential risks in the Strait of Hormuz, and the high probability of further Fed rate hikes this year collectively form clear resistance to gold’s upward movement. Wall Street analysts remain generally cautious, while main street investors have grown more optimistic after support levels held. In the short term, gold may continue to trade within a range of $3,960 to $4,170, with the fate of the $4,000 level determining the next directional move.
From a longer-term perspective, the fundamental logic of gold as a safe-haven and inflation-hedging asset has not been altered by a temporary military pause. As long as the Middle East fails to achieve a genuine and lasting diplomatic breakthrough, the potential risks of oil price and inflation rebounds will persist; if the Fed is forced to raise rates amid inflationary pressures, it could further suppress gold prices. Investors should closely monitor the wording of this week’s Fed decision, the evolving situation in Iran, and upcoming economic data. In an environment of continued uncertainty, gold’s safe-haven appeal may re-emerge at critical moments, but its short-term upside potential may be constrained. The market stands at a crossroads of multiple challenges, and gold’s next move will depend on the final balance of these interwoven factors.
(Spot gold daily chart, source: E-Hui-Tong)
At 07:22 Beijing Time, spot gold is trading at $4,085.69 per ounce.
The military ceasefire has ignited diplomatic hopes, and market concerns over supply disruptions have quickly subsided.
U.S. Ambassador to the United Nations, Mike Waltz, stated on Sunday, July 26, that after two consecutive nights without airstrikes on Iran, President Trump decided to create some room for diplomatic efforts with Iran. The Iranian military also simultaneously announced a pause in retaliatory strikes against U.S. allies in the Middle East, citing that the U.S. had ceased attacks for two consecutive nights. Previously, after 13 days of consecutive U.S. strikes on Iran, operations were halted from late Friday night, and the Iranian Army stated that Tehran had suspended its response actions.
Although the two countries reached a ceasefire agreement in April and signed a memorandum of understanding for 60 days of peace talks in June, recent conflicts have reignited over control of the Strait of Hormuz. Iranian military spokesperson Mohammad Akrami emphasized that Iran’s actions are retaliatory in nature, and if the U.S. continues its military campaign, particularly through airstrikes, the situation will escalate further. The suspension of military operations has renewed hopes for the resumption of U.S.-Iran negotiations. Prior to this, Iran had again closed the strait after hostilities resumed, and reports indicate that six vessels attempting to transit were detained within the past 24 hours.
Meanwhile, internal signals from the U.S. side are also worth noting. CNN, citing Pentagon sources, reported that military action against Iran has been “suspended,” while The New York Times reported that ammunition shortages and the risk of regional conflict escalation have prompted the U.S. to put its escalation plans on hold. However, Ambassador Waltz firmly denied any shortage of supplies, stating that U.S. forces have all the resources they need and criticized the leak of such information. An Iranian senior official told the media that Tehran’s position is clear—respond to attacks with attacks; if the U.S. stops its strikes, Iran will also cease its actions, and this message has been conveyed to the United States.
However, a senior Iranian source noted that Tehran is more skeptical than optimistic about this pause, viewing it as a tactical adjustment rather than a genuine shift in intent, given Iran’s extensive history of being deceived by the United States. According to multiple media reports, Trump made the decision to pause following last Friday’s meeting, during which Chairman of the Joint Chiefs of Staff General Cain and several senior military and political advisors expressed concerns about next steps; Vice President Vance had reservations about continuing the attacks, and U.S. Central Command Commander General Cooper recommended halting the bombings, as the operation’s effectiveness had nearly reached its limit.
This pause directly alleviated market concerns regarding supply terminals in the Strait of Hormuz. The decline in oil prices not only cooled inflationary worries but also eased pressure on the Federal Reserve to raise interest rates, with the US Dollar Index opening and closing lower, falling as much as 0.23% to 101.22. As a traditional safe-haven asset, gold quickly rebounded under the dual influence of falling oil prices and a temporary easing of geopolitical tensions, reclaiming the $4,050 level.
Gold holds key support, but expectations of Fed rate hikes continue to pose upward resistance.
Last Friday, spot gold rose slightly by 0.1%, closing at $4,053.29 per ounce, up 0.9% for the week. Independent metal trader Tai Wong noted that despite persistently rising yields, gold and silver appear to be finding support around $3,950 and $55, respectively. While a sharp escalation in conflict could still push prices below these levels and trigger stop-losses, gold seems poised for a rebound; a clear signal from the Fed next week that it will hold rates steady would be supportive for gold prices. Analysts at ING believe that gold’s recent strength appears largely driven by bargain buying and short-covering, following a significant pullback from record highs earlier this year. High oil prices and rising yields may cap any further upside, making $4,000 a key level to watch in the near term.
The latest Kitco News weekly gold survey shows that Wall Street is bearish or uncertain about the short-term outlook for gold prices, while Main Street sentiment has improved after gold once again held the $4,000 support level.
Adrian Day, President of Adrian Day Asset Management, said that while cautiously optimistic, the situation is not yet resolved, as the Federal Reserve may still raise rates, while the Asian giant’s economy slows and implements stimulus measures. Encouragingly, over the past seven days, gold prices have remained largely flat—declining initially before rebounding—despite escalating tensions in Iran, rising oil prices and a stronger dollar, and increasing expectations of a Fed rate hike before year-end. When any asset or market fails to decline in the face of negative news, it is a bullish signal.
Rich Checkan, President and Chief Operating Officer of Asset Strategies International, believes two forces are at play: oil prices above $100 per barrel and a strong support level at $4,000. After multiple tests of the $4,000 support, he believes it will hold, but as long as tensions in the Middle East keep oil prices and inflation concerns elevated, gold will struggle to rise significantly.
Lukman Otunuga, Head of Market Analysis at FXTM, noted that Brent oil briefly surged above $100, putting significant pressure on gold. This chain reaction has now taken hold: higher oil prices intensify inflation concerns, increase bets on Fed rate hikes, strengthen the dollar, and push up Treasury yields—all of which pose downside risks for gold, which offers no yield. He warned that while technical forces may drive a modest price increase, geopolitical tensions could limit any sustained recovery in gold.
Forex senior market strategist James Stanley is more optimistic, believing that the $4,000 level has held up well so far, with demand emerging during tests below. Large participants with a long-term horizon—such as central banks, pension funds, and hedge funds—will view this as an opportunity. With a Federal Reserve meeting coming up next week and stock markets beginning to show signs of strain, he expects Powell to try to support President Trump by sounding less hawkish than many anticipate. In the long term, tightening or balanced budgets are not on the horizon in the near term, so the bullish case for gold remains intact even amid this temporary counter-trend backdrop.
Colin Cieszynski, Chief Market Strategist at SIA Wealth Management, holds a neutral view. He believes gold has already experienced a significant rally, and many war-related factors have been priced in; however, the drop from $5,500 to $4,000 has not fully alleviated all war-related concerns. Prices remain elevated, and there is concern this could lead to rate hikes. Inflation data has been lagging, and if oil prices continue to rise, inflation could rebound in one to two months. Based on this, the dollar may begin to strengthen, creating headwinds for gold. Currently, gold is stabilizing at a middle ground and needs three to six months to consolidate. He does not expect significant volatility in the gold market around the upcoming Fed rate decision, noting that it is peak summer and volatility has already been high; the Fed does not want to stir up trouble. Gold is likely to remain within its recent trading range of $3,960 to $4,170 over the coming week.
Ahead of the Federal Reserve meeting, interest rate expectations and geopolitical risks intertwine to drive gold prices.
This week, global financial markets will face multiple challenges. The Federal Reserve will announce its interest rate decision on Wednesday, with markets widely expecting the federal funds rate to remain unchanged at 3.50%-3.75%. Due to a 27% surge in oil prices this month, which has intensified inflation concerns, markets have priced in approximately 44 basis points of rate hikes by year-end. Investors will closely monitor the FOMC statement and Chair Powell’s press conference for clues on the future policy path. JPMorgan Chase’s Chief U.S. Economist, Michael Feroli, expects the Fed to hold rates steady at this week’s meeting, but anticipates at least two committee members will vote against it with a hawkish stance, as some officials are growing impatient with inflation remaining persistently above target.
According to data from the CME FedWatch tool, the probability that the Fed will hold rates steady in July is 63.7%, while the probability of a cumulative 25-basis-point hike is 36.3%. By September, the probability of holding rates steady is 19.6%, with a 55.2% chance of a cumulative 25-basis-point hike and a 25.2% chance of a cumulative 50-basis-point hike. By December, the probability of holding rates steady drops to just 7.8%, with a 30.9% chance of a cumulative 25-basis-point hike and a high 61.5% chance of at least a 50-basis-point hike; the probability of at least one rate hike this year stands at 92.2%. These figures indicate that although the upcoming meeting this week may hold rates steady, the pressure for rate hikes this year remains significant and could limit gold price gains.
On the economic data front, the U.S. will release June durable goods orders, July consumer confidence index, first-quarter GDP estimate, June PCE price index, and personal income and spending data, as well as the final July University of Michigan consumer sentiment index. These data points will provide the market with the latest assessment of economic resilience and inflation trends. The Bank of England is expected to hold rates steady at 3.75% on Thursday, the Bank of Japan is anticipated to maintain its rate at 1% on Friday, and the eurozone will also see a batch of key data releases. With multiple factors converging, they are expected to dominate market movements.
Summary: Gold faces short-term pressure, but its long-term fundamentals remain intact; the $4,000 level is a key observation point.
The sudden pause in U.S.-Iran military actions has provided the market with a brief reprieve. The decline in oil prices has eased concerns over inflation and supply disruptions, allowing gold to stabilize and rebound above $4,000, while stock index futures have also strengthened. However, Iran’s skepticism regarding the U.S. commitment to a ceasefire, the potential risks in the Strait of Hormuz, and the high probability of further Fed rate hikes this year collectively form clear resistance to gold’s upward movement. Wall Street analysts remain generally cautious, while main street investors have grown more optimistic after support levels held. In the short term, gold may continue to trade within a range of $3,960 to $4,170, with the fate of the $4,000 level determining the next directional move.
From a longer-term perspective, the fundamental logic of gold as a safe-haven and inflation-hedging asset has not been altered by a temporary military pause. As long as the Middle East fails to achieve a genuine and lasting diplomatic breakthrough, the potential risks of oil price and inflation rebounds will persist; if the Fed is forced to raise rates amid inflationary pressures, it could further suppress gold prices. Investors should closely monitor the wording of this week’s Fed decision, the evolving situation in Iran, and upcoming economic data. In an environment of continued uncertainty, gold’s safe-haven appeal may re-emerge at critical moments, but its short-term upside potential may be constrained. The market stands at a crossroads of multiple challenges, and gold’s next move will depend on the final balance of these interwoven factors.
(Spot gold daily chart, source: E-Hui-Tong)
At 07:22 Beijing Time, spot gold is trading at $4,085.69 per ounce.