Gold holds above $4,000 again!

Gold performed well today, holding the $4,000 level, and rebounded slightly after the Asian market opened.

In terms of news, it was reported that Middle East mediators have proposed a 10-day ceasefire plan to Langzi, seeking to restore navigation through the Strait of Hormuz.

Langzi's foreign affairs spokesperson also confirmed this at a press conference on the same day, stating that negotiations with the US could be conducted based on the interests of Derelan. Its Minister of Internal Affairs will visit Pakistan on the same day; these moves release more signals of 缓和 (easing).

Although both sides have a certain need for a ceasefire to some extent, war has always been unpredictable, and even previously signed agreements can be broken again.

Therefore, for gold, inflation concerns caused by geopolitical conflicts still exist. For gold to achieve a true right-side rally, it must wait for US inflation data to cool down. Only when there is a real cooling of inflation data will the Federal Reserve's expectation of rate hikes decrease, lowering gold's opportunity cost, allowing the market to return to the right side.

Here, I still maintain my judgment: The baseline scenario for the Fed's interest rate policy within the year is no rate hike or cut, corresponding to gold returning to $4,500. In an optimistic scenario with one rate cut, gold may surge to $5,000. In a pessimistic scenario with one rate hike, gold may fall below $3,800.

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