Gold price hangs near two-week low on Israel-Iran ceasefire; downside lacks follow-through

• Gold price extends the previous day’s slide amid the Israel-Iran ceasefire announcement.

• July Fed rate cut bets weigh heavily on the USD, supporting the non-yielding commodity.

• The XAU/USD bears also seem reluctant to commit ahead of speeches from influential FOMC members.

Gold price (XAU/USD) touches a nearly two-week low, around the $3,333 area during the Asian session on Tuesday, though it lacks follow-through amid mixed fundamental cues. The global risk sentiment gets a boost in reaction to US President Donald Trump's announcement that a ceasefire had been brokered between Iran and Israel. However, Iran's foreign minister said there would be no cessation of hostilities unless Israel stopped its attacks. Moreover, the Israel Defense Forces (IDF) said that it had identified missiles launched from Iran toward southern Israel. This keeps geopolitical risks in play and helps limit losses for the safe-haven precious metal.

Meanwhile, mixed US PMI data and dovish remarks by Federal Reserve (Fed) officials fueled speculations about the possibility of a rate cut in July. This drags the US Dollar (USD) to a one-week low and turns out to be another factor acting as a tailwind for the non-yielding Gold price. Furthermore, traders opt to wait for speeches from a slew of influential FOMC members, including Fed Chair Jerome Powell's congressional testimony, for cues about the future rate cut and to position for the next leg of a directional move in the commodity. This, in turn, warrants some caution for the XAU/USD bears and positioning for a further intraday depreciating move.

Daily Digest Market Movers: Gold price bears seem reluctant as weaker USD offsets Iran-Israel ceasefire optimism

US President Donald Trump announced that Israel and Iran have agreed to a complete and total ceasefire, providing a goodish lift to the global risk sentiment. However, reports suggest that Israel has launched some attacks against Iran.

Moreover, Iran’s Foreign Minister, Abbas Araqchi, said that if Israel stopped its illegal aggression against the Iranian people no later than 00.30 GMT on Tuesday, Iran had no intention of continuing its response afterward, per Reuters.

This, along with persistent trade-related uncertainties, keeps a lid on the market optimism. Apart from this, some follow-through US Dollar selling for the second straight day assists the Gold price to stall its slide to a nearly two-week low.

Meanwhile, data released on Monday showed that S&P Global’s flash Manufacturing PMI held steady at 52 in June, while the gauge for the service sector cooled slightly to 53.1 from 53.7 and the composite index slipped to 52.8 from 53.0 in May.

Adding to this, Federal Reserve Governor Michelle Bowman said that the time to cut rates may be fast approaching as she has grown more worried about risks to the job market and less concerned that tariffs will cause an inflation problem.

This backs Fed Governor Christopher Waller's view that the US central bank should consider cutting interest rates at its next policy meeting on July 29-30, which keeps the USD depressed and further supports the non-yielding yellow metal.

Traders now look to the US economic docket – featuring the release of the Conference Board's Consumer Confidence Index and the Richmond Manufacturing Index. This, along with speeches by influential FOMC members, will drive the USD.

The focus, however, will remain glued to Fed Chair Jerome Powell's testimony before the House Financial Services Committee, which could offer cues about the future rate-cut path and determine the near-term trajectory for the XAU/USD pair.

Gold price could slide below trend-channel and 100-period SMA

From a technical perspective, the commodity now seems to have found acceptance below the 100-period Simple Moving Average (SMA) on the 4-hour chart and is looking to extend the fall below a short-term ascending channel support. Moreover, oscillators on the said chart have been gaining negative traction and back the case for a further intraday depreciating move. Some follow-through selling below the $3,323-3,322 intermediate support will reaffirm the outlook and drag the Gold price to sub-$3,300 levels.

On the flip side, any meaningful recovery beyond the $3,368-3,370 immediate hurdle is more likely to attract fresh sellers and remain capped near the $3,400 round figure. The latter should act as a key pivotal point, which if cleared decisively could lift the Gold price to the $3,434-3,435 area en route to the $3,451-3,452 zone, or a nearly two-month top touched last Monday. The subsequent move up could extend further towards challenging the all-time peak, around the $3,500 psychological mark.