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Mid East Info
12 hours ago
- Business
- Mid East Info
Gold drops as markets cheer Middle East ceasefire – but for how long? - Middle East Business News and Information
By Daniela Sabin Hathorn, senior market analyst at Gold prices are facing renewed pressure as markets cautiously celebrate a declared ceasefire between Iran and Israel. The price of XAU/USD has dropped below its 20-day simple moving average, a key technical indicator, reflecting a shift away from safe-haven assets and into riskier options like equities. The Relative Strength Index (RSI) has also fallen below 50 for the first time since mid-May, when gold saw a deeper correction down to $3,120. Despite the pullback, the move appears to be relatively controlled. Long-term fundamentals supporting gold remain intact, though technical traders are now eyeing the $3,330 level as a key support zone. A decisive move below this threshold could signal a deeper retracement and a change in market sentiment. Gold (XAU/USD) daily chart Past performance is not a reliable indicator of future results. The broader market response to Iran's recent military action has been surprisingly subdued. The attack—targeting a U.S. military base—was expected to rattle investors, yet the global reaction has been more one of tentative relief than alarm. This suggests the strike was largely symbolic rather than escalatory in nature, limiting its impact on financial markets. Adding a layer of finality to the episode, former U.S. President Donald Trump announced that a ceasefire had been reached, dubbing the event the 'Twelve-Day War.' His statement implied that the conflict had effectively concluded, though many geopolitical analysts caution that this may be an overly optimistic interpretation. Prior to the agreement, Trump emphasized the absence of American casualties and praised Iran for issuing a prior warning: 'I want to thank Iran for giving us early notice, which made it possible for no lives to be lost. Most importantly, they've gotten it all out of their 'system,' and there will, hopefully, be no further hate. Perhaps Iran can now proceed to peace and harmony in the region, and I will enthusiastically encourage Israel to do the same.' While intended to calm tensions, these remarks may have unintended political consequences. Public praise from a former U.S. president could weaken Tehran's domestic narrative that the attack was a powerful and deliberate move. Instead, it may appear conciliatory, even orchestrated, potentially undermining the regime's posture both at home and in the broader region. This raises broader questions: Are these confident declarations of de-escalation premature? And how can such a significant event—a direct confrontation many feared might spiral into a regional war—elicit such a subdued response compared to earlier crises? The disparity in global reaction suggests a shifting global perspective. Geopolitical threats may still carry weight, but market participants increasingly appear to differentiate between symbolic posturing and genuine escalation. Whether this ceasefire marks a true turning point or simply a pause in hostilities remains to be seen.
Middle East Eye
a day ago
- Politics
- Middle East Eye
After a shaky ceasefire, US and Israel can hardly claim to have deterred Iran
It seems a ceasefire has been achieved in what US President Donald Trump is now calling the "Twelve-Day War" between Israel and Iran. However, the key question is what motivated the parties involved to accept it? For the United States, the calculation is fairly straightforward. Washington viewed the war launched by Israel primarily as an instrument to improve its negotiating position vis-a-vis Tehran. If Israel succeeded, Iran would be compelled to comprehensively dismantle its nuclear programme, renounce its right to enrich uranium on its own territory as guaranteed by the Nuclear Non-Proliferation Treaty (NPT), terminate its ballistic missile programme, and sever links with armed movements comprising the "axis of resistance" in a subsequent agreement dictated by Washington. Washington's objectives were further demonstrated by its bombing of Iran's three nuclear installations over the weekend accompanied by threats of a more widespread campaign if Tehran retaliated. While Trump at one point identified regime change in Tehran as a desirable outcome, he never committed to it, nor instructed the US military to pursue this goal. As expected, Trump immediately proclaimed the complete obliteration of the three nuclear sites targeted by the US air force and boasted that the Iranian nuclear programme had been definitively destroyed and no longer existed. A boast better known as proclaiming victory and going home. New MEE newsletter: Jerusalem Dispatch Sign up to get the latest insights and analysis on Israel-Palestine, alongside Turkey Unpacked and other MEE newsletters Indeed, numerous specialists derided Trump's claims, pointing out that Iran had removed its stockpile of highly enriched uranium and key equipment prior to the US attacks, and that the US is unlikely to have inflicted more than significant damage on the key Iranian facility of Fordow. More importantly, Iran retains the knowledge base to reconstitute its programme in full. As everyone and their brother has been saying for years, absent the physical occupation of Iran, a military campaign can delay but not terminate its nuclear programme. Furious debates The US is likely to have concluded that the Israeli campaign against Iran's nuclear and military capabilities has reached its limits, and that it only made sense to continue in the context of achieving the different outcome of regime change. After US attack, Iran could reconsider its nuclear strategy Read More » Additionally, Iran's retaliation for the US bombing, consisting of a telegraphed and largely symbolic attack directed at the US air base of al-Udaid in Qatar, caused no casualties. Trump could afford to dismiss these as the performative, harmless firecrackers which they were. But they also brought into view the real danger of further regional escalation and that, if Iran feels sufficiently threatened, it is prepared to expand the conflict. Back in Washington, Israel's war, and even more so Washington's direct participation in it, have produced furious debate and considerable dissension within Republican party ranks. On one side stood those who wanted nothing to do with the war, on the other those determined to go all the way, and in the middle Trump who cares for neither faction and is committed solely to himself. He may have come to the belated realisation that he had been effectively snookered by Israeli Prime Minister Benjamin Netanyahu, and that if he did not get out quickly, he would rapidly become mired into Iraq on steroids and preside over the destruction of the MAGA coalition. Which is another way of saying Washington made the proverbial phone call, and we now appear to have a ceasefire. For Iran, the calculation was relatively straightforward. From the very outset, Tehran denounced Israel for launching a war of aggression and consistently called for it to end. Although it has sustained severe damage, its nuclear programme remains, and judging by its final salvos on Tuesday, its missile capabilities remain relatively intact. Effective retaliation With the passage of time, Tehran was able to demonstrate the growing effectiveness of its retaliatory strikes on Israel and increasing failures of the US-Israeli anti-missile defences. Iran seemed more prepared for a prolonged conflict with Israel. At the same time, prolonged conflict holds little attraction for Iran. The damage inflicted by Israel would only expand in size, scope and severity, and it would have been reasonable to assume that the US - particularly if Tehran rejected a ceasefire proposal that does not entail its capitulation - would get more deeply involved. Israel failed to embroil the US into a decisive military conflict with Iran If Iran had indeed unleashed a regional conflict, this would also have destroyed the relationships with the Gulf Cooperation Council (GCC) states it has spent the past several years methodically cultivating and improving. It also seemed highly unlikely that either Russia or China were prepared to replenish Iran's severely degraded air defences while the war persisted. The ceasefire proposed by the Americans, which essentially only requires the Iranians to stop firing back at Israel, was seen by Tehran as a safe and acceptable exit - provided it is not another US-Israel ruse. Israel is in a more complex situation. Most importantly, Netanyahu failed to embroil the US into a decisive military conflict with Iran. Israel failed to achieve any of its proclaimed objectives, from the destruction of Iran's nuclear programme to regime change in Tehran. Iran also continued firing lethal ballistic missile salvos until the last moment before the ceasefire went into force, so Israel can hardly claim to have deterred Iran. Israel's anti-missile defences were not only failing with increasing frequency but also running dangerously low. Israel did of course inflict severe damage on the Iranian military, its security forces, and to a lesser extent also its civilian infrastructure and government institutions. It assassinated numerous senior commanders and scientists, and while these are undoubtedly painful blows, the individuals are being replaced. Israel also managed to demonstrate the extent to which its intelligence services successfully and comprehensively penetrated Iran. It seems reasonable to assume that Israel would have preferred to continue and expand the war in order to at least achieve an Iranian capitulation to Washington. The phone call from Washington, announcing a ceasefire rather than a new bombing campaign, put paid to this aspiration. Indeed, the meltdown among Israel's apologists suggests it is not the outcome Israel intended or was hoping for. The Lebanon model Moving forward, neither Israel nor Iran have, at least as of yet, formally accepted a ceasefire agreement, but appear to have instead endorsed an arrangement. Iran has stated that there is no agreement, but that if Israel stops firing at Iran, it will reciprocate. Israel for its part will try to replicate the model it established in Lebanon - a ceasefire that strictly applies to its adversary, but that Israel is free to violate, with US endorsement, at will. Israel will try to replicate the model it established in Lebanon - a ceasefire that strictly applies to its adversary. It is unlikely to work in Iran's case It is unlikely to work in Iran's case. How Iran responds to further sabotage conducted from within the country by Israeli agents, as opposed to air raids originating from Israel, is a murkier matter. Speaking of Lebanon, Israel may well, in addition to continuing with the Gaza genocide, also launch a new and extensive campaign in that country in an effort to further weaken Hezbollah and promote its disarmament by the Lebanese state. This is only to be expected from a state that not only has become addicted to war, but seems to require it. Ceasefires typically require political arrangements to become sustainable. This returns us to the US-Iranian negotiations that, like the 2015 Iranian nuclear agreement, Trump reneged upon two weeks ago and instead chose war. Given that Washington manufactured a crisis in these negotiations by insisting that Tehran renounce its rights under the NPT to enrich uranium to low levels for civilian purposes on its own territory, Iran is unlikely to return to the negotiating table unless - and until - the US drops this demand and recognised Iran's rights under the NPT. Israel-US attack on Iran: The price of Netanyahu's forever wars Read More » It will also, as previously, refuse to enter into negotiations about its ballistic missile programme and regional relationships. If it does, that would constitute clear evidence Israel successfully brought Iran to its knees. The other open question concerns Iran's nuclear ambitions. In 12 short days, Israel and the United States have shredded the NPT and indeed the nuclear regulatory regime that has existed for decades. Will Iran now, or if negotiations once again get stuck, expel International Atomic Energy Agency (IAEA) inspectors, exit the NPT, remain outside it, like Israel, and like the latter covertly develop a nuclear bomb? The Iranian leadership will be under tremendous pressure, from within its own ranks and Iranian society at large, to bite this bullet. It may now find it no longer useful to continue deploying its nuclear threshold status as leverage in negotiations with the West, as opposed to a pathway to the ultimate deterrent. The views expressed in this article belong to the author and do not necessarily reflect the editorial policy of Middle East Eye.
