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Gold Drops Through 200-Day MA as US Strikes Iran Again
Gold broke below its 200-day moving average after US strikes on Iran extended a war that has pushed inflation to 4.2%. The metal is down more than 20% since late February.
Gold fell for a third straight session, sliding through its 200-day moving average after the US launched fresh missile strikes against Iran. The metal dropped as much as 0.9% to near $4,036 an ounce in early Asian trading, extending a 4.4% decline from the prior session.
The US military said it fired missiles at multiple targets inside Iran. President Donald Trump accused Tehran of dragging out talks on an interim peace deal. Iran's armed forces said they retained the ability to retaliate.
The war is now in its fourth month. Energy flows through the Strait of Hormuz remain disrupted, pushing oil prices higher and feeding inflation expectations. US consumer prices accelerated in May to 4.2% year-over-year, the fastest since early 2023, according to Bureau of Labor Statistics data. That pace outstripped wage gains and raised the odds that central banks will keep rates elevated.
Gold has now lost more than a fifth of its value since the conflict began at the end of February. The break below the 200-day moving average – a level institutional investors use to gauge long-term momentum – triggered additional selling as stop-losses and algorithmic models reacted to the breach.
Spot gold traded at $4,036.66 an ounce at 6:25 a.m. in Singapore. Silver slid 1.4% to $62.46. Platinum and palladium also retreated.
The question for traders holding long positions is whether the 200-day break is a liquidation event or the start of a deeper trend shift. The last time gold traded below that average was in late 2022, before the metal rallied more than 40% over the following 18 months. The difference this time is the macro backdrop: a war that shows no sign of de-escalation, sticky inflation that limits central bank flexibility, and a dollar that has strengthened as safe-haven flows favor cash and Treasuries over bullion.
For now, the path of least resistance is lower until either the strikes stop or the CPI data softens enough to revive rate-cut bets. Neither catalyst is visible on the near-term calendar.