$XAUUSD Gold next week: Limited upside, the real gold pit is below

Dear old friends, over this weekend, many of you probably stared at your phones unable to sleep.

The US and Iran are at it again, and the Russia-Ukraine conflict has escalated to bombing a Moscow refinery—two geopolitical hotspots flaring up simultaneously. Following the usual script, with this weekend's combination of events, a lower open for gold on Monday morning is highly likely—don't get me wrong, it's not that safe-haven demand has failed; it's a liquidity stampede: after Friday's close, both the Middle East and Eastern Europe saw incidents, leveraged positions cut first to survive, and when Asian markets open, gold will likely take the initial hit.

But what happens after that initial drop is the real critical question.

🔥 Dual geopolitical fronts: Safe-haven on the surface, hidden risks underneath

First, the US-Iran situation.

On June 18, Iran and the US signed a framework peace agreement in Switzerland, with the ceasefire memorandum barely dry. By June 26-27, the US military struck 10 Iranian targets—including surveillance facilities along the Strait of Hormuz, communication systems, drone hangars, and mine-laying equipment. Iran's Revolutionary Guard didn't back down either, retaliating on the 28th against Kuwait's Ali Al Salem Air Base and 8 facilities of the US Fifth Fleet in Bahrain, vowing "US bases will experience hell in the coming days."

More critically—the next round of talks scheduled for June 28-29 in Burgenstock, Switzerland, is now in doubt.

Now, the Russia-Ukraine front.

On June 18, Ukraine launched the largest drone attack on Moscow since the conflict began, hitting the Moscow refinery (16 km from the Kremlin) and causing indefinite shutdown. On the 26th, Russia intercepted 660 drones overnight, triggering a state of emergency in Crimea. Russian hawks have openly urged Putin to "consider tactical nukes."

Looking at both lines together, the situation smells off.

⚠️ The normal script would be "conflict escalation → safe-haven buying of gold," but this round has a variable—Trump. Trump said this week, "If Iran breaches again, the Islamic Republic will cease to exist." Around the G7 at the end of this month, if he suddenly turns hawkish (not just on Iran, but also on Russia), the dollar and gold could rise together, but it's more likely a mispricing structure where the dollar runs first and gold is suppressed by Treasury yields.

So my judgment: After Monday's lower open, if geopolitics don't spiral further during the week, gold will see a "weak recovery"—not a true recovery, but a recovery that's like licking blood from a knife.

 

📉 Thursday night's Nonfarm Payrolls: Be extra cautious about the "accounting adjustments"

July 3 (Thursday) at 8:30 PM ET, June's Nonfarm Payrolls.

Why single this out? Because US employment data in recent months has increasingly shown the problem of "initial readings being inflated, revisions being real":

BLS updated the Birth-Death model starting January 2026, incorporating real-time samples monthly to fix overestimates from PPP fraud—but short-term monthly volatility will increase

Combined with the annual benchmark revision (QCEW quarterly wage survey calibration), the March 2025 benchmark revision slashed 911k jobs

May's Nonfarm initial print of 172k "blew estimates away," but historically—after a single-month extreme high, there's a 72% probability of a decline/downward revision in the following 1-2 months

In other words, Thursday's data might still look good on the initial read, but "accounting adjustments" will cause more disruption than usual. The winning move is to wait for the data to come out before betting—don't front-run.

If Nonfarm is strong → Fed turns hawkish → Treasury yields surge → gold takes another hit.

If Nonfarm is weak + downward revision → "soft landing" narrative breaks → gold bids for safe-haven, but only if geopolitics don't cool down.

Neither scenario supports a "gold V-shaped reversal." At best, a bounce after being deeply sold off.

 

🤖 AI bubble loosening: The final straw for gold may not be war

Many haven't noticed—on the day of May's Nonfarm, the Nasdaq dropped 4.18% in a single day, and the probability of a 25bp rate hike by year-end skyrocketed from 60% to 98%.

The high valuations of the AI chain rely on the "Fed must cut this year" narrative. That anchor is now shaking:

Microsoft/Google/Meta's capex is still burning, but ROI doubts are rising

Nvidia's valuation percentile remains at historical highs—any rate hike would crush valuations

If an AI leader issues a downward guidance revision, tech stocks will trample → margin calls → gold gets sold off in tandem (the October 2022 episode followed this script)

AI bubble loosening + dual geopolitical fronts + Nonfarm accounting adjustments + Trump's hawkish stance—these four events converging in the same week is not a coincidence; it's a resonance.

🎯 Conclusion: Limited upside, the real pit is below

Direct judgment:

Next week (June 30 - July 4), gold overall will maintain a pattern of "limited upside, significant downside."

Monday lower open → weak recovery (assuming geopolitics don't worsen further)

Thursday's Nonfarm "accounting adjustment" disruption → likely another selloff

If the AI chain loosens simultaneously → gold could be mispriced into a genuine pit

Why do I say "next week is the last escape window"? I'm not telling you to escape gold—I'm telling you to escape the old script that "geopolitical conflict automatically means gold goes up."

The structure of this round is: the dollar is propped up by "yuan taking over yen's carry trade + AI capital inflows," while gold's safe-haven premium is squeezed by real Treasury yields and the AI capital vacuum. Only when the AI bubble truly bursts will gold see a double play of "panic + rate-cut expectations"—but that's for later. For now, this week: survive first.

A once-in-a-century gold pit is never called into existence; it's hammered out.

Follow the Gold Intelligence Bureau; we only tell the truth.