Market Focus | Can Gold Withstand Renewed Geopolitical Risks?

Market Focus | 22/06/2026

Key Highlights

• Iran has suspended negotiations following warnings from Trump, reigniting geopolitical tensions.

• Safe-haven sentiment has strengthened, with capital flowing into the U.S. dollar and other defensive assets.

• The U.S. Dollar Index continues to rise, while gold and risk assets remain under pressure.

Market Review

President Trump warned Iran against continuing its support for Hezbollah and stated that the United States could take further action if tensions escalate. In response, Iran announced the suspension of negotiations and vowed to respond to any threats.

The renewed tensions in the Middle East have increased demand for safe-haven assets, supporting the continued strength of the U.S. Dollar Index. Meanwhile, gold and U.S. equity indices have come under pressure as investors reassess geopolitical risks.

Affected Instruments: USD, Gold, S&P 500

Market Summary

The renewed tensions between the United States and Iran have significantly boosted risk aversion in financial markets. Capital has flowed into defensive assets, particularly the U.S. dollar, helping the Dollar Index maintain its upward momentum.

In the short term, geopolitical developments are expected to remain the primary driver of market sentiment, potentially leading to increased volatility across gold, equities, and other risk-sensitive assets.

Today's Key Economic Event

Canada Consumer Price Index (CPI)

Investors will closely monitor Canada's latest inflation data for clues regarding the future policy direction of the Bank of Canada. A stronger-than-expected CPI reading could reinforce expectations that interest rates will remain elevated for a longer period, potentially increasing market volatility.

Affected Instruments:

• U.S. Dollar (USD)

• Precious Metals (Gold, Silver)

• U.S. Stock Indices

Market Sentiment Analysis

The latest Fear & Greed Index has declined to 30, indicating that market sentiment remains in a risk-off environment. While Middle East tensions have fueled demand for safe-haven assets, investors have gradually begun to price in recent developments, leading to a modest easing in overall market anxiety.

Going forward, traders should continue to monitor geopolitical developments closely, as they are likely to have a significant impact on risk sentiment and capital flows.

Technical Analysis | XAUUS

Gold has recently broken below the key support zones represented by the EMA89 and EMA144, forming a bearish “N-shaped” price structure that suggests sellers remain firmly in control.

If safe-haven demand continues to ease, gold could face further downside pressure and test lower support levels. The overall technical outlook remains bearish, with a preference for selling on rallies while monitoring short-term rebounds for potential entry opportunities.