7.13 Gold Strategy Gold Morning Brief: Gold deep-V reversal! 4070 bottoms and rebounds higher—are the shorts about to back off?

Last week, gold swung like a roller coaster. In the early session, it surged to 4134, then came under pressure and pulled back. During the European session it kept weakening. In the US session, it briefly dipped to the 4072 low, before bargain hunters stepped in and quickly pushed it higher. In the end, it regained most of its losses, closing around 4119. On the 30-minute timeframe, a standard deep-V reversal pattern formed, and the long/short battle has been unusually fierce.

From the news side, hawkish expectations for the Federal Reserve have continued to weigh on the market. CME data shows the probability of a July rate hike has risen to 33%, and the 10-year US Treasury real yield has held above 4.51%, increasing the cost of holding gold. However, tensions in the Middle East have heated up again: the risk in the Strait of Hormuz has risen, safe-haven buying backed by geopolitics has provided support, and on top of that, global central banks have continued to buy gold on dips, making downside support equally strong—resulting in a tug-of-war between bulls and bears.

From the technical perspective, on the 30-minute timeframe, gold has found strong support around 4070. The long lower shadow highlights buyer strength, and near-term rebound momentum is relatively strong. On the upside, watch the 4135 prior high pressure; if it breaks, it could open up room to the upside. On the downside, 4070 is the key support—if it breaks, the weakness is likely to continue. Currently, price is consolidating in the 4080-4130 range.

Trading reference: sell in batches in the 4120-4140 rebound area, targets at 4100 and 4050. $XAUT