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Conflict Situation 1. United States – ① Trump: Agreed to cancel strikes against Iran. ② U.S. Central Command: A U.S. Marine Corps F-35C stealth fighter took off from the USS Abraham Lincoln aircraft carrier, which is sailing in the Arabian Sea to support the U.S. blockade of Iran. 2. Israel – Israel Defense Forces: Killed two Hamas commanders in Gaza over the weekend. ② Israel claims Netanyahu learned of the U.S. call for a halt to strikes against Iran through Trumps social media. ③ The Israel Defense Forces remain on high alert today, believing Iran may create unforeseen circumstances. 3. Iran – ① Iranian military: Trump called Irans demand to stop the attacks a "lie." ② A spokesperson for the Iranian Revolutionary Guard said the strike on the Amazon data center in Bahrain was a response to U.S. action; the spokesperson did not specify the timing of the strike. U.S.-Iran Negotiations 1. Iran – ① Iranian President: The memorandum of understanding with the United States will be central to our future diplomatic relations. ② Iranian Parliament National Security Committee: Mediators are assisting in the restoration of the memorandum of understanding between Iran and the United States, and all parties have exchanged views on all issues. 2. United States – ① Rubio: The US strikes have made Iran more willing to negotiate; the era of "negotiating without consequences" is over. Strait of Hormuz 1. Iranian media: Reports that Iran has agreed to reopen the Strait of Hormuz are false. 2. Diplomatic sources report that Qatari diplomats are negotiating with Iran to secure the support of the Iranian Revolutionary Guard for arrangements related to the Strait of Hormuz. 3. Iranian Foreign Ministry: Negotiations with Oman on the Strait of Hormuz have entered the final stage. The Strait of Hormuz will not return to its pre-war state, and the issue of reopening is unrelated to the negotiations with Oman. Other developments 1. Saudi Foreign Minister speaks with Qatari Prime Minister. 2. Gulf states are dissatisfied with the US lack of a strategy against Iran. 3. Acting Iranian Defense Minister: Iran will not be "caught off guard" by its enemies, nor will it stand idly by. 4. Iranian Foreign Minister Araqchi speaks with Iraqi Foreign Minister; they discuss the latest developments in the region and ways to strengthen bilateral and regional cooperation. 5. The OPEC+ Joint Ministerial Monitoring Committee (JMMC) met on Sunday and stressed the importance of protecting international sea lanes to ensure the continued flow of energy.In early trading, the US dollar fell 0.3% against the Japanese yen (USD/JPY), currently trading at 157.16, down about 30 points from Fridays close.U.S. Senate Minority Leader Schumer: The continuing resolution announced today is a responsible choice.On August 3, Iranian Foreign Minister Araqchi spoke by phone with the Iraqi Foreign Minister, discussing the latest developments in the region, ways to strengthen bilateral and regional cooperation, and the most important issues of common concern to both countries.On August 3rd, US President Trump stated on Saturday evening (Eastern Time) that he would suspend a new round of attacks on Iran, awaiting the resumption of negotiations to end the war and restore cargo transport halted in the Strait of Hormuz. This is the latest example in a series of US presidents threatening large-scale attacks only to cancel them later. This sudden shift has become a prominent feature of the five-month-long US-Iran conflict. According to statistics, similar "scripts" have played out eight times so far. 1. April 7th: Trump announced a two-week ceasefire with Iran less than two hours before the "deadline." At that time, he demanded Iran submit, or face attacks on bridges and power plants—which he claimed would mean "the destruction of an entire civilization." 2. April 21st: Trump announced an indefinite extension of the ceasefire agreement with Iran, just one day before the agreement expired, the same day the US launched attacks on Iranian oil tankers. 3. May 18th: After issuing harsh threats to Iran over the weekend, Trump stated he was suspending a large-scale military strike plan because "serious negotiations" were underway. By May 27th, the negotiations had broken down, and the US resumed attacks. 4. June 11: After two days of mutual attacks, Trump escalated his threats further, saying the U.S. would "strike hard tonight" Iran and "take full control" of its oil and gas industry. However, hours later, Trump posted on social media that negotiations had made a breakthrough and canceled the strikes. 5. June 17: Trump and Iran signed a preliminary agreement requiring a permanent cessation of hostilities and the reopening of the Strait of Hormuz, while launching a 60-day countdown to negotiations to reach a final agreement on the future of Irans nuclear program. 6. July 7: Following Iranian attacks on merchant ships in the Strait of Hormuz, Trump launched new strikes against Iran while attending the NATO leaders summit in Ankara, Turkey. He then again threatened to "get the job done," saying he believed the ceasefire was over. 7. July 27: Trump said he had paused two weeks of intensive daily strikes against Iran to give negotiations another chance. During the 13-day strikes, the U.S. military targeted key military and commercial facilities as tensions along shipping routes continued to escalate. 8. August 1: After telling reporters that the United States would strike Iran “severely,” Trump said on social media that he had canceled the planned strike, claiming that Middle Eastern allies had reached a framework agreement to end the war, including reopening the Straits.

Gold Price Prediction: XAU/USD bears at $1,650 on Fed hawkishness and China news

Daniel Rogers

Sep 19, 2022 14:34

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During early Monday morning in Europe, the gold price (XAU/USD) maintains a position close to the intraday low at $1,670. In doing so, metal prices endure the weight of a stronger U.S. dollar amidst a sluggish session caused by Japanese and British vacations. The cause may be related to the Fed's hawkish bets and China-related news stories.

 

US Dollar Index (DXY) reverses a two-day slump while posting intraday gains of 0.18 percent at 109.85 as of press time. Indicators of the U.S. dollar's value versus the six major currencies have recently been buoyed by the University of Michigan's September consumer sentiment report and the market's positive expectations on the Fed's next move. Consequently, the probability of a 75-basis-point (bps) rate hike by the Federal Reserve increased to 80%, while the market's estimates of a one-percentage-point increase in the Fed rate rose to 20% at the latest.

 

US President Biden stated elsewhere, "I'm more positive than I've been in a long time." The national leader also claimed that inflation will be brought under control. On the same line are the covid updates from China, which have unlocked Dalian and Chengdu while observing zero coronavirus cases in Beijing and one, as opposed to zero the day before, outside of Shanghai's quarantine zone. However, US President Biden's willingness to support Taiwan in the event that China assaults Taiwan and hawkish expectations for the Federal Reserve appear to weigh on the steel price ahead of the major monetary policy pronouncements.

 

In addition, the People's Bank of China (PBOC) reduces the 14-day reverse repo rate by 10 basis points to 2.15 percent. "With no maturing reverse repos on Monday, the Chinese central bank injects 12 billion yuan," reports Reuters. The same might have indicated that the dragon nation is not in recovery mode and requires more rate cuts than rate raises, which could have caused the gold price to plummet. The cause is China's position as one of the world's largest gold consumers.

 

In light of this, the S&P 500 Futures post modest losses while mirroring Wall Street's Friday close. Notably, the selling in Japan curbs bond movements in Asia, but yields are robust near the multi-day high due to fears of a recession and hawkish Fed views.

 

Moving forward, a light economic calendar and important market holidays may limit intraday XAU/USD price fluctuations. However, bears are expected to maintain control because to aggressive Fed expectations, which, if dashed, might defy the bearish chart pattern and spark the long-awaited rally.