GOLD loses ground as rising oil prices fuel inflation fears

Gold fell over 3% in sharp acceleration on Monday after President Trump rejection of Iran’s proposal for easing tensions in the region and re-opening Straight of Hormuz, lifted oil prices and fueled inflation fears, boosting expectations for more aggressive Fed’s stance on interest rates.

Gold price fell to the lowest in nearly two months, in the biggest daily loss since Aug 28, as fresh acceleration lower generated signal of bearish continuation of larger downtrend from $4697 (Aug 25 peak), following break of pivotal $4630 zone (higher base / Fibo 61.8% of $3942/$4697 rally).

Bears also broke below ascending and thickening daily Ichimoku cloud (spanned between $4287 and $4383) turning daily technical studies into full bearish configuration that adds to increasingly negative fundamentals.

Bears pressure initial targets at $4120 (Fibo 76.4%) and $4100 (round figure) violation of which would unmask psychological $4000 support.

Broken $4230 zone reverted to resistance which should ideally cap upticks and offer better levels to re-join bearish market.

Res: 4200; 4230; 4250; 4280
Sup: 4140; 4120; 4045; 4020