Wall Street folds after gold loses 10% in a week, Main Street turns negative as Iran war escalation looms

Gold prices plunged over 10% in a single week, falling from $5,023/oz to settle just below $4,500/oz amid renewed global uncertainties and dovish central bank rhetoric. The week saw significant volatility as spot gold hovered near $5,000/oz until breaking critical support at $4,970/oz midweek before collapsing to an intraday low of $4,477/oz. Key catalysts included hotter-than-expected PPI data, the Federal Reserve's interest rate hold, and Powell's cautious press conference remarks, which together weighed on bullion prices. Market experts surveyed by Kitco News revealed a largely bearish near-term sentiment from Wall Street, with many throwing in the towel amid the sharp correction. However, some analysts, including Rich Checkan and Darin Newsom, remain bullish longer term, emphasizing that the geopolitical risks surrounding the escalating Iran conflict and persistent inflationary pressures should ultimately draw safe-haven buying back into gold. Adrian Day sees current weakness as temporary, citing central banks' reluctance to cut rates despite energy price concerns. The sharp price drop below critical technical levels raises risks of continued downside volatility near term, but strong geopolitical tensions and inflation trajectories serve as key factors that could underpin a rebound. Traders should watch for the $4,450-$4,500 support zone as well as Fed policy signals amid uncertain global growth dynamics. Near-term, volatility is likely to remain elevated ahead of next week's economic data releases and ongoing geopolitical developments in the Middle East. Broader macro uncertainty and the unresolved Iran situation create a cautious backdrop for gold, with potential for sharp swings as market participants reposition. While Wall Street sentiment has turned pessimistic, contrarian views suggest the current pullback presents a buying opportunity into this largely defensive asset class.