Fundamental Analysis

  • Following a U.S.-Israel strike on Iran, geopolitical tensions in the Middle East escalated sharply. The closure of the Strait of Hormuz triggered a surge in oil prices, while safe-haven demand pushed gold sharply higher with a gap up. As European nations signal involvement, concerns about a prolonged conflict are growing. Gold is targeting $5,500, with potential upside toward $6,150. Heightened market volatility is expected this week.

Over the weekend, the United States and Israel launched attacks on Iran, reportedly killing Supreme Leader Ayatollah Khamenei. Strikes were carried out across multiple regions, and Iran responded in retaliation. Middle Eastern Arab nations condemned the counterattacks, while Iran moved to close the Strait of Hormuz, a vital route for oil tankers. As a result, oil shipments have effectively halted as tankers prioritize safety.

President Trump mentioned that the operation could last around four weeks, but doubts remain as to whether the conflict will end so quickly. The UK, France, and Germany also announced plans to participate in operations against Iran. The situation has escalated into a broader conflict involving Europe and the West, with no clear outlook.

Gold opened with a gap higher, paving the way toward $5,500. Crude oil prices also surged. A new record high is anticipated, and a scenario targeting around $6,150 (the 256.1% extension level) is now within view.

With Western involvement expanding, capital may continue flowing into safe-haven assets such as precious metals and the Japanese yen. U.S. equities during New York trading hours also face the risk of sharp declines. Strong caution is warranted amid rising volatility this week.

Gold (Daily Chart): Markets Dislike Uncertainty

Markets tend to react negatively to uncertainty. The attack on Iran raises the risk of a prolonged and complex war. Unlike the Gaza conflict, Iran has a vast territory. Historical examples such as the Iraq war, which took over seven years until troop withdrawal, and the Afghanistan war, which lasted 20 years, illustrate how extended such conflicts can become.

On the hourly chart, gold has decisively broken out above its range. The 61.8% level is being watched, and a move toward the 100% level at $5,500 is possible. There is currently little reason to sell gold. Both the euro and the U.S. dollar may face selling pressure, while capital is likely to continue flowing into precious metals.

The preferred trading strategy is to buy on dips.

Gold (1-Hour Chart)