Middle East Fears Drive Gold Up, Euro Gains, Bitcoin Falls

Gold rises due to escalating Middle East tensions

1. Trouble in the Middle East: There’s a lot of tension and fighting brewing between Israel and Iran. When things get unstable in the world, people tend to buy gold because it’s considered a “safe place” to put their money. They’re worried about bigger conflicts, so they’re rushing to buy gold to protect their savings.
2. U.S. Economy News: Recent reports show that prices in the U.S. aren’t going up as fast as expected. This makes it more likely that the U.S. central bank (the Federal Reserve) will lower interest rates. When interest rates are lower, it becomes less appealing to keep money in things that pay interest, like savings accounts. So, people choose to put their money in gold instead, which doesn’t pay interest but can go up in value.

What this means for people who buy and sell (traders):

• Gold’s price has already jumped quite a bit, going above $3,436, which is its highest in over a month.
• Keep an eye on the $3,500 level; if gold goes above that, it could go even higher.
• Also, watch $3,400 as a support level; if it drops below that, it might go down.
• Because of the ongoing tensions, gold prices are likely to keep moving up and down a lot.
• As long as there’s worry about the Middle East, gold will probably remain a popular choice for safety.
• Traders should also pay attention to what the U.S. central bank does with interest rates, as that will also affect gold’s price.

EURUSD rises towards three-year high

The Euro (money used in Europe) is getting stronger compared to the U.S. Dollar (U.S. money). It’s almost at its highest point in three years! Here’s why:

1. Trump’s Tariff Worries: The U.S. President, Donald Trump, has been talking about putting extra taxes (called tariffs) on goods from other countries. This makes people who trade and invest worried because it could mess up how countries do business with each other. When people get worried about the U.S. economy, they often take their money out of U.S. Dollars and put it into other currencies, like the Euro, because they see it as a safer bet.
   • Mixed Messages: It’s a bit confusing because while Trump is threatening tariffs, his money guy, Scott Bessent (the Treasury Secretary), has hinted that they might not put tariffs on right away if countries are playing fair. This back-and-forth adds to the uncertainty.
2. U.S. Economic News: Recent reports show that prices in the U.S. aren’t going up as fast as predicted. This makes it more likely that the U.S. central bank (the Federal Reserve) will lower interest rates again this year. When a country’s interest rates are low, its money becomes less appealing to investors, which makes the U.S. Dollar weaker. And a weaker U.S. Dollar means the Euro looks stronger in comparison.

What this means for people who buy and sell currencies (traders):

• Euro’s Rise: It looks like the Euro will probably keep getting stronger against the U.S. Dollar, especially if Trump keeps threatening tariffs and if the U.S. economy keeps showing signs that might lead to lower interest rates.
• Waiting for News: Traders are now waiting for more economic news from the U.S. (called the University of Michigan Consumer Sentiment Index), which is coming out at 7:30 PM today (Indian Standard Time).
  • If this news is better than expected, it could make the U.S. Dollar stronger and stop the Euro from rising.
  • If the news is worse than expected, the Euro will likely continue to go up.
• Middle East Conflict: The ongoing fighting between Israel and Iran could also make the market more unpredictable. Big global events like this can sometimes make currency prices jump around a lot.