Commodity analysts remain very bullish on gold in the long run; However, as the summer trading season begins, investors should not expect a breakthrough rebound in the near future.

Despite optimistic market sentiment, gold is still stuck in a relatively narrow trading range. Last Friday (June 12th), gold failed to maintain a sustainable increase above $2350 per ounce. The downside is that gold has successfully maintained a support level of around $2300 per ounce.

Gold prices started strong last week but fell before the weekend. August gold futures closed at $2334.7 per ounce last Friday, with a weekly decline of 0.58%. Spot gold closed at $2321.19 per ounce last Friday, with a weekly decline of 0.49%.

Gold prices fell more than 1% last Friday, dragged down by the strengthening US dollar and rising bond yields, after data showed strong business activity in the United States; The automotive catalyst metal palladium jumped as much as 11%.

Bart Melek, head of commodity strategy at Daoming Securities, said, "We are likely to see a reaction to this morning's interest rate hike and the continued strength of the US dollar, which was caused by earlier data."

Against the backdrop of a rebound in employment, business activity in the United States climbed to a 26 month high in June. Thursday's data showed a mild decline in the number of people applying for unemployment benefits for the first time in the United States last week.

The dollar rose 0.2% on Friday, reaching a seven week high of 105.92 and closing at 105.83, making gold more expensive for holders of other currencies, while the yield of 10-year US treasury bond bonds rose after the release of US data.

According to data from the FedWatch tool of the Chicago Mercantile Exchange, traders currently believe that the likelihood of the Federal Reserve cutting interest rates in September is 65%, with little change compared to late Thursday last week. The lower interest rates lower the opportunity cost of holding unprofitable gold.

Chantelle Schieven, head of research at Capital Research, stated that investors should be prepared for increased volatility in the gold market. She explained that traditionally, the summer market has low liquidity, which can lead to increased volatility. At the same time, market uncertainty remains extremely high as the market attempts to speculate on the next steps of the Federal Reserve.

"Gold is currently a bit stagnant and has responded to everything because we don't know what the Federal Reserve will do," she said. "Every unexpected data is enough to cause interest rate expectations to fluctuate back and forth, driving gold prices up and down."

Although gold prices are stagnating, Schieven said it is important to pay attention to the overall situation. She said that the gold price has established a stable bottom at around $2280 per ounce. She added that although inflationary pressures remain high, she expects the Federal Reserve to cut interest rates in September to support the economy.

"The biggest takeaway from the latest comments from the Federal Reserve is that they are no longer so worried about inflation and are now turning their attention to the labor market," she said. "The potential weakness in labor market activity will prompt the Federal Reserve to cut interest rates after the summer."

Naeem Aslam, Chief Investment Officer of Zaye Capital Markets, stated that he expects gold to continue to receive good support in the short term as traders use precious metals to hedge their positions before the summer vacation.

However, Aslam added that he does not believe there will be any breakthrough.

He said, "We continue to uphold our position that unless we hear more noise from members of the Federal Open Market Committee, the path with the least resistance will continue to consolidate."

Although gold prices have failed to maintain a rise of over $2350 over the past five weeks, David Morrison, Senior Market Analyst at Trade Nation, said he remains bullish on gold prices.

He pointed out that the integration of the market has eliminated many foam.

"Despite the sell-off on June 20th, the recent trend of gold seems quite constructive. Since the strong employment report was released two weeks ago, gold has been rising. The support level is around $2300, and the daily MACD has stabilized slightly below neutral levels and is expected to rise," Morrison said in a comment on Kitco. "The significant fluctuations in gold and silver that we are seeing now are exactly the kind of fluctuations expected before the big wave. As summer progresses and trading volume decreases, these fluctuations will intensify."

However, not all analysts are optimistic that gold prices can maintain their current high levels. Barbara Lambrecht, a commodity analyst at Commerzbank, said that the Federal Reserve is unwilling to signal the start of a new round of easing.

Lambrecht stated in a report last Friday that "the potential for further increases may be limited as the United States may not cut interest rates for the first time until the end of this year." "In addition, gold ETFs have recently experienced another outflow of funds. As a result, speculative financial investors' net long positions rose to their highest level since the spring of 2020 in the previous reporting week, so their market positioning is also worth noting. The highly optimistic sentiment of these investors may lead to a decline in gold prices."

Despite the relatively light economic data in the coming week, there are still enough reports to bring some volatility to gold. The focus of the next week will be on the Personal Consumption Expenditure (PCE) index released on Friday, which is the Federal Reserve's preferred inflation indicator.

Some analysts suggest that weak inflation data may strengthen the determination to cut interest rates in September, thereby supporting gold prices.

Technical Analysis of Spot Gold

At the daily level, spot gold lost its 55 day moving average last week and recorded a bearish candlestick combination of "swallowing" at a relatively high level. The pattern is also somewhat similar to a bearish "flag shape", and gold prices may explore the support of the Bollinger Line below 2278. The support of the more than two and a half month low point touched on May 3 is also near this position. In addition, there is also some support around the nearly one and a half month low point of 2286.68 and the 2300 level touched on June 7.

The resistance of the 55 day moving average above is around 2243.20, and before regaining this position, the market tends to be bearish in the future; There is also some resistance around the short-term 21 day moving average of 2332.74.

Resistance: 2323.15; 2330.62； 2338.52； 2343.19； two thousand three hundred and fifty

Support: 2316.64; 2304.03； 2395.49； 2386.68； two thousand three hundred and seventy-seven point one eight

Economic data worth paying attention to this week:

Monday: 2024 FOMC Voting Committee and San Francisco Fed Chairman Daley delivered a speech on monetary policy and the economy.

Tuesday: The US June Consumer Confidence Index and Federal Reserve Director Bowman delivered speeches on monetary policy and bank capital reform.

Wednesday: Annual total sales of new homes in the United States after May quarterly adjustment, and Federal Reserve releases annual bank stress test results

Thursday: Final GDP of the first quarter of the United States, initial unemployment claims for the week ending June 22, initial monthly rate of durable goods orders in May, and monthly rate of signed sales of completed homes in May after quarterly adjustments in the United States

Friday: US May PCE Price Index Annual Rate, US May Core PCE Price Index Annual Rate

Pay attention to news related to the geopolitical situation

The volatile geopolitical situation may still attract bargain hunting to provide support for gold prices.

Israeli airstrikes in eastern Lebanon, killing senior members of Hamas

According to the Israel Times, the Israeli military reported that on June 22 local time, the Israeli army carried out an air raid on eastern Lebanon, killing a senior member of the Palestinian Islamic Resistance Movement (Hamas), Ayman Gatma. According to reports, Emma Gatma is responsible for providing weapons to organizations such as Hamas stationed in Lebanon.

The city of Sidon in southern Lebanon has been hit by Israeli air strikes for the first time since this round of conflict

On June 22 local time, an orchard in the eastern part of Sidon City (also known as Saida City) in southern Lebanon was hit by Israeli military planes. The attack did not cause any casualties. Xidun City is nearly 60 kilometers south of the temporary border between Lebanon and Israel, and about 35 kilometers north of the capital city of Beirut. This is the first time that the city of Sidon has been attacked by Israeli forces since the outbreak of conflict on the temporary border between Lebanon and Israel on October 8, 2023.

The United States warns Israel: Attack Lebanon or trigger broader conflict

US Joint Chiefs of Staff Chairman Brown said on Sunday that Israel's attack on Lebanon may increase the risk of a broader conflict, with Iran and armed militants allied with Iran potentially involved, especially in the face of threats to Hezbollah's presence. "In terms of overall capabilities, rocket numbers, etc., Hezbollah is stronger than Hamas. I just want to say that I will see Iran more inclined to provide more support to Hezbollah," Brown said. This senior American general did not predict Israel's next action and acknowledged Israel's right to self-defense.

The Prime Minister stated that the "intense combat" phase of military operations will end and more troops will be deployed to the north

On the 23rd local time, Israeli Prime Minister Netanyahu stated that the "intense combat phase" of Israel's military actions against organizations such as Hamas is coming to an end. However, to ensure that Hamas and other organizations will not regain control of Gaza, the Israeli military will continue to fight in Gaza. After the "intense combat phase" ends, Israel will deploy more troops to the north of the country. In addition, regarding the Gaza ceasefire and personnel exchange agreement, Netanyahu stated that he is prepared to reach an agreement to facilitate the release of some Israeli detainees. But he opposes signing agreements at critical moments of military action and always insists that Israel needs to resume military operations in Gaza after a ceasefire.

Hamas claims to confirm with the Prime Minister's statement that it has rejected the ceasefire agreement

In the early morning of the 24th local time, Hamas issued a statement citing Israeli Prime Minister Netanyahu's previous statements in interviews with local media, including Netanyahu's statement that he will continue military operations in Gaza and that his goal is only to reach a phased agreement for the release of some detained individuals. The statement believes that such statements clearly demonstrate that Netanyahu has rejected recent United Nations Security Council resolutions urging a ceasefire in Gaza, as well as the so-called ceasefire and personnel exchange plan that Israel has agreed to, as proposed by US President Biden. This is completely opposite to what the US government claims.

Russian Ministry of Defense: High precision weapons have been used to carry out cluster strikes on Ukrainian energy facilities

The Russian Ministry of Defense announced on Saturday that the Russian military has launched a cluster attack on Ukraine's energy facilities, which are supported by military industrial complexes, using long-range air and sea based precision weapons and drones.

Russia claims to have shot down 23 Ukrainian drones in Bryansk Oblast

Several Russian media outlets have reported that from the late night of June 22 to the early morning of June 23 local time, air defense systems shot down at least 23 Ukrainian drones in the Bryansk Oblast, including 12 within an hour.