<p>Gold prices suffered their steepest weekly decline since 2024, dropping below the $4,700 mark as a toxic combination of surging crude oil prices and hawkish central bank repricing hammered the precious metal.</p>

<h2>Why Gold Is Falling Despite Geopolitical Risk</h2>
<p>In normal times, wars drive gold higher. But the current Middle East conflict is creating an unusual dynamic: oil prices are surging so aggressively that they are fueling inflation expectations globally. Higher inflation means central banks are less likely to cut rates — and some, like the ECB, are now expected to hike. Higher interest rates increase the opportunity cost of holding non-yielding gold, making bonds and cash more attractive.</p>
<p>The result is a paradox: geopolitical risk is elevated, but the inflation it creates is actually bearish for gold through the rates channel.</p>

<h2>Key Levels to Watch</h2>
<p>Gold found initial support near $4,554, where previous demand converged. Below that, the psychological $4,500 level looms large. On the upside, the $4,800 mark and the 200-period EMA on the 4-hour chart act as resistance. The RSI has pulled back from overbought territory above 70 toward the mid-50s, suggesting fading upside momentum.</p>

<h2>What Could Reverse the Trend</h2>
<p>A ceasefire in the Middle East would collapse oil prices rapidly, easing inflation fears and allowing rate cut expectations to rebuild — potentially triggering a sharp gold rally. Alternatively, if the conflict escalates to the point where financial markets face systemic risk, gold's safe-haven bid could overwhelm the rates argument.</p>

<h2>Trader Takeaway</h2>
<p>Gold is caught between two forces: geopolitical demand and inflation-driven selling. Until the oil situation resolves, expect continued volatility. Traders should watch the $4,500-$4,800 range for the next directional breakout.</p>

<p><em>This article is for educational purposes only and does not constitute investment advice. Trading CFDs involves significant risk of loss.</em></p>