At the end of the Asian session on Monday (August 12), gold rebounded in the short term and hit $2,442, while Bitcoin fell below the $58,000 mark and hit a low of $57,651. Ukrainian President Zelensky broke his silence over the weekend and officially confirmed for the first time a bold cross-border Russian ground operation, and Russian President Vladimir Putin's government began to retaliate harshly against the Ukrainian capital. The threat of an Iranian attack is imminent, and Hezbollah fired rockets at Israel.
Russia blasts Ukrainian capital in "harsh retaliation"
Well-known financial blog ZeroHedge reported that the Kursk invasion has entered its sixth day. Zelensky said: "Today, I received several reports from Commander-in-Chief Serski about the front line and our actions to push the war into the aggressor's territory. Ukraine is proving that it can indeed restore justice and ensure the necessary pressure on the aggressor."
On the same day, the Russian Foreign Ministry stressed that the Russian army would soon respond strongly. But this response seems to have begun over the weekend, as the Ukrainian capital of Kiev was hit by a fierce missile attack. The missiles did not reach the city center, but the suburbs were affected.
AP News quoted the Ukrainian Air Force as saying that at least four ballistic missiles hit the capital area, along with 57 Shahed drones, and the Ukrainian Air Force also said that its air defense forces intercepted 53 of the drones.
Zelensky claimed that Russia used a North Korean ballistic missile in the airstrike. Zelensky said on social media: "According to preliminary information, Russia used a North Korean missile in this attack. This is another deliberate terrorist attack against Ukraine. Experts are still working to determine the exact data of this missile."
U.S. Ambassador to Ukraine Bridget Brink condemned Russia for another airstrike that she said killed a man and his 4-year-old son.
As it does after any major Russian airstrike, Zelensky urged Western allies to provide more immediate defensive equipment to guard the skies. "To truly stop Russian terror, we need not only a comprehensive air defense system that can protect all of our cities and communities, but also strong decisions from our partners that will remove constraints on our defense operations," he said.
The "strong decision" mentioned here is clearly a call for more direct involvement of Western troops, and some analysts believe that the ongoing Kursk cross-border offensive is a last-ditch and desperate strategy to force escalation so that the United States and NATO can intervene more directly, or gain influence. Others say that this is all for PR purposes, and that Ukrainian troops are being sacrificed in what is essentially a suicide mission for propaganda purposes, which only temporarily dampens the morale of the Kremlin.
It also appears to be a distraction from the Ukrainian front, where Ukraine has a poor record and is seriously short of manpower. This could force Russia to mobilize reservists from the Donbas region to urgently protect its borders. Ukraine continues to launch drones and missiles into Russian territory, with one of the drones hitting a building in Kursk on Sunday, injuring 13 people, according to local sources.
Middle East powder keg explodes: Hezbollah launches rockets into northern Israel
Focus turns to the Middle East, according to CNN, Hezbollah fired multiple rockets into northern Israel on Sunday night. After the assassination of a senior Hamas leader last month, the Israeli army remains on high alert to prevent possible retaliation from Iran and its proxies.
Rocket fire from the Iran-backed Hezbollah militia in southern Lebanon into Israel has become an almost daily occurrence since the outbreak of the Gaza war, raising concerns that Iranian attacks could escalate into a wider regional conflict.
Hezbollah said in a statement that the latest salvo was in support of the Palestinian people in Gaza and in retaliation for an Israeli attack on southern Lebanon, which came after the Lebanese state news agency reported that an Israeli attack on the southern Lebanese town of Maroub had injured 12 people, including six children.
The Israel Defense Forces (IDF) said about 30 rockets were fired from Lebanon, some of which landed in open areas, causing no casualties. Earlier on Sunday, the IDF said its instructions to the public had not changed despite the possibility of a military response from Iranian forces to the July 31 assassination of Hamas political leader Ismail Haniyeh in Tehran.
"The IDF and security agencies are closely monitoring our adversaries and the situation in the Middle East, with a focus on Iran and Hezbollah, and are constantly assessing the situation," said IDF spokesman Rear Admiral Daniel Hagari. "IDF forces are deployed and in good combat readiness. If a change in directive is necessary, we will release it in an orderly manner through official channels."
Looking ahead, investors are cautious and await key U.S. inflation data before making any major bets on gold. The U.S. Producer Price Index (PPI) will be released on Tuesday, followed by the Consumer Price Index (CPI) on Wednesday.
In addition, U.S. retail sales data released on Thursday will affect expectations of the Federal Reserve's policy direction, affect demand for the U.S. dollar, and may drive gold prices. The development of the geopolitical situation will also affect the short-term trend of gold.
The dollar has maintained its upward momentum despite market expectations that the Federal Reserve will cut interest rates by 25 basis points in September, with some even considering a 50 basis point cut. However, the dollar's gains may be short-lived due to expectations of rate cuts and high risk appetite in the stock market.
Normally, positive stock market sentiment would challenge this safe-haven asset, but several factors continue to support the dollar and limit downside risks. Federal Reserve Governor Michelle Bowman pointed out on Sunday that the Fed may not be ready to cut interest rates in September, citing inflation risks and a strong labor market. However, this did not lead to a lot of dollar buying or have a significant impact on gold prices.
In the short term, gold is expected to maintain its upward momentum, with support at $2,429 and potential resistance at $2,453. Key U.S. inflation data released this week may trigger major market fluctuations, so it is recommended to operate with caution, as a break below $2,429 may lead to increased selling pressure.
Bitcoin Technical Analysis
FXEmpire analyst Bob Mason said Bitcoin is below the 50-day and 200-day EMAs, sending a bearish price signal.
A breakout of the 200-day EMA will support Bitcoin to move towards the $60,365 resistance level. A breakout of the $60,365 resistance level could push the 50-day EMA into play.
On the other hand, a break below $55,000 could signal a drop to the $52,884 support level.
With a 14-day RSI reading of 42.76, Bitcoin could drop to around $55,000 before entering oversold territory.
