Oil Prices Surge Amid Iran Conflict, Gold Fluctuates: Gold Price Risks Second Consecutive Weekly Decline - How to Trade Next?

Hot Topics

Selected Stocks Data Center Market Center Capital Flows Simulated Trading

Client

Source: 24K99

On Friday (March 13) during Asian trading hours, gold prices rebounded slightly, but due to the Middle East conflict keeping oil prices around $100 per barrel, gold may continue to decline for the second consecutive week.

After two days of decline, spot gold rose above $5,100 per ounce, partially recovering some losses, driven by a stable US dollar and oil prices fluctuating after reaching their highest close since August 2022. The White House approved buyers to receive Russian oil cargoes already at sea, aiming to ease price pressures.

However, from a weekly perspective, gold prices could still fall about 1%. If this happens, it would be the first consecutive two-week decline since November last year. Since the outbreak of the US-Israel and Iran conflict nearly two weeks ago, gold’s rally has stalled, with no signs of short-term recovery.

(Source: Bloomberg)

U.S. President Donald Trump and Iran’s new Supreme Leader Mojtaba Khamenei issued tough statements on Thursday. The conflict has lasted 13 days, effectively blocking shipping through the Strait of Hormuz and causing the largest impact on the global oil market in history.

Brent crude oil experienced significant volatility over the week and saw fluctuations on Friday; the US dollar index slightly declined after rising 0.5% in the previous trading session.

Rising Oil Prices and Pressure on Gold

For gold, rising energy prices and increasing inflation concerns have significantly reduced market expectations for rate cuts by the Federal Reserve and other central banks. The latest US unemployment claims report showed continued low new claims, further decreasing the likelihood of rate cuts.

On Thursday, US Treasury yields surged, reaching their highest levels since August last year. Traders now almost entirely dismiss the possibility of a rate cut at next week’s Fed meeting, with only a 70% chance of a rate cut this year. Higher borrowing costs are generally unfavorable for precious metals, which do not pay interest.

Ongoing Conflict and Supply Risks

The ongoing conflict has dampened investor interest in gold, leading to choppy trading and replacing the long-term bullish trend. Investors are selling gold to meet margin requirements in other parts of their portfolios. Nevertheless, gold prices are still up about 18% this year and remain mostly above $5,000 per ounce.

If the conflict persists and oil prices stay high, further pressure on gold is likely. The International Energy Agency (IEA) stated on Thursday that the war is causing unprecedented supply disruptions in the oil market. Just the day before, IEA members agreed to release a record 400 million barrels from emergency reserves.

Technical Analysis

From a technical perspective:

Support Levels: Recent support is around $5,050 to $5,000 per ounce. If broken, short-term tests could see prices drop to about $4,950 per ounce.

Resistance Levels: Current gold prices face resistance between $5,100 and $5,150. A breakout above this range could challenge $5,200.

Trends and Indicators: Short-term moving averages (such as 10-day and 20-day) show oscillating downward momentum, but medium- and long-term averages (50-day, 100-day) remain upward, indicating overall bullish strength. The RSI hovers between 40-50, suggesting the market is not oversold but momentum is weakening.

Trading Strategy Recommendations

Based on fundamentals and technicals, traders may consider the following strategies:

Short-term Trading

1. Look for long opportunities near support levels ($5,000–$5,050), with stop-losses below $4,950.

2. Consider short positions near resistance levels ($5,100–$5,150), with stop-losses above $5,200.

Medium to Long-term Strategies

1. If the conflict escalates and oil prices rise further, consider accumulating medium- to long-term long positions on dips, holding until key resistance levels or market risks ease.

2. If geopolitical tensions ease, the dollar rebounds, or Fed rate cut expectations increase unexpectedly, cautiously reduce gold holdings and monitor other safe-haven assets like silver or government bonds.

Risk Management

1. Due to high geopolitical influence, limit individual positions to 10-20% of total funds.

2. Set strict stop-losses and monitor oil and dollar index movements, as they are highly correlated with gold prices.

As of 11:38 Beijing time, spot gold is at $5,108.42 per ounce.

Identify trends, and secure your gains!

Instead of watching in volatility, let every trade bring tangible rewards. The VSTAR Smart Investment Platform has now been fully upgraded:

One-stop Trading: Gold | Oil | Cryptocurrency | Global Indices — one app covers multiple markets

Points System Launch: New “Points Mall” now live, earn points with every trade

Exclusive Gifts: iPhone 17 Pro Max, DJI Pocket 3, AirPods 4, and more popular prizes waiting for you to redeem

Sina Partner Platform Futures Account Opening — Safe, Fast, and Secure

Sina Statement: This message is reprinted from Sina’s partner media. Sina.com publishes this article to share more information and does not necessarily endorse or verify its views or descriptions. The content is for reference only and does not constitute investment advice. Investors operate at their own risk.

Massive Information, Precise Analysis, all on Sina Finance APP

Editor: Zhu Hennan