I. Tariff Legal Disputes Rekindle Geopolitical and Policy Fractures
On Tuesday, as legal battles surrounding US tariff policy escalated sharply, combined with highly contradictory signals released by the US and Iran regarding peace talks, the global macroeconomic pricing environment plunged into a complex state torn between policy and geopolitical tensions.
On the trade and tariff front, 25 US states led by Democrats filed a joint lawsuit against the Trump administration in the US Court of International Trade in New York, alleging that the White House exceeded its legal authority by invoking Section 301 of the Trade Act of 1974 to impose tariffs of 10% to 12.5% on 60 trading partners.
The plaintiffs noted that the White House used combating forced labor as a pretext to reimpose comprehensive tariffs previously ruled unlawful by courts, which fails to resolve structural issues while escalating cost burdens for businesses and consumers. This has kept markets on high alert regarding prolonged global trade friction and potential secondary inflation risks.
II. Intraday Price Action Surges and Retraces Under Overhead Moving Average Pressure
As of 17:08 Beijing Time on August 4, spot gold was trading at 4049.15 USD per ounce, down 0.15% (a modest drop of 6.04 USD) on the day, after sliding from an afternoon peak of 4072.84 USD.
Late-afternoon sharp breakdown:
Gold opened today at 4048.26 USD, finding solid buying support after testing an early session low of 4042.58 USD, advancing in steps to hit an intraday high of 4072.84 USD around 15:30.
However, after 16:00, as news of the tariff lawsuit intensified and profit-taking emerged, candlestick charts formed consecutive large bearish candles, plunging vertically through multiple short-term support lines to retest the lower support platform near 4049.15 USD.
III. Technical Indicators Signal Strong Sell Alongside Oversold Divergence
According to technical indicator data at 17:08, gold's steep late-session drop shifted overall technical ratings from morning bullishness to Strong Sell (1 bullish, 0 neutral, 8 bearish), reflecting strong short-term bearish control while sensitive oscillators hit extreme oversold territories:
Core oscillators and trend indicators turn bearish:
The Relative Strength Index RSI(14) printed at 43.866, the Stochastic Oscillator STOCH(9,6) recorded 42.865, and the Commodity Channel Index CCI(14) posted -194.3021, all entering bearish control tracks; the Average Directional Index ADX(14) recorded 23.557, highlighting steep short-term downward momentum.
Sensitive indicators reach historic oversold levels:
Fast Stochastic RSI Fast dropped to 0.000, and Williams Percent Range Williams %R recorded -99.954, both plunging into extreme oversold zones. This indicates concentrated late-session selling has been heavily absorbed, suggesting potential position turnover and technical support near the 4048 USD low.
Summary
In summary, the gold market today was impacted by a joint lawsuit filed by 25 US states over Section 301 tariffs against the Trump administration, conflicting signals regarding US-Iran peace talks, and the drone strike on a commercial cargo vessel off Oman. On the macro level, legal policy disputes and diplomatic uncertainty continue to preserve a fragile market equilibrium.