On Friday, President Donald Trump said that the United States will impose a 100% tariff on all imports from countries that levy digital services taxes on American companies, escalating tensions over taxation of U.S. technology firms.
In a post on Truth Social, Trump stated that several European countries are considering digital services taxes. He warned that any nation implementing such measures would face immediate 100% tariffs on all goods exported to the United States. Trump further asserted that these tariffs would supersede any existing trade agreements with the U.S., irrespective of their current status.
On Sunday, when the U.S.-Iran conflict reached 121st day, U.S. President Donald Trump said American forces carried out fresh strikes on Iranian missile and drone storage sites as well as coastal radar installations after accusing Tehran of violating the ceasefire agreement for a second time.
In a post on Truth Social, Trump said the strikes were launched after Iran again breached the ceasefire. “United States aircraft just struck Iranian missile and drone storage locations, and coastal radar sites, for violating the Cease Fire Agreement, AGAIN!” he wrote.
Trump also warned that if violations continue, “there may come a point when we are no longer able to be reasonable,” adding that the U.S. could be “forced to militarily complete the job that we very successfully started.”
The United States launched another round of strikes against targets in Iran on Saturday after Tehran allegedly carried out a second drone attack on a commercial vessel despite a ceasefire agreement, according to U.S. Central Command.
Iranian state media reported explosions in the port cities of Sirik and Bandar Lengeh, as well as on Qeshm Island in the Persian Gulf, after projectiles struck the areas. The three locations are home to military facilities, according to state media.
Undoubtedly, a renewed threat came after French President Emmanuel Macron said last week that France would not scrap its digital services tax on U.S. technology companies, despite pressure from Washington. Macron’s remarks came just hours before meeting Trump at the G7 summit. France has applied a 3% digital services tax since 2019, targeting companies with annual digital services revenue exceeding €25 million in France and €750 million worldwide.
Even before traveling to the summit, Trump had warned that the U.S. would impose 100% tariffs on French wine unless Paris withdrew the tax.
Gold prices ticked up more than 1% on Friday but ended the week with losses, as a stronger dollar, boosted by elevated Federal Reserve rate-hike bets, outweighed easing inflationary concerns amid sliding oil prices.
ticked up 1.6% to settle at $4,090.26/oz, while added 1.4% to settle at $4,103.00/oz. The former notched weekly losses of 1.7% and posted a four-week losing streak, while the latter declined 3.3%.
Metal market participants this week have been squarely focused on the outlook for monetary policy amid mixed signals from U.S. economic data and oil prices.
The May core personal consumption expenditures (PCE) price index – widely seen as the Fed’s preferred inflation gauge — ticked up slightly in May from April on both a M/M and Y/Y basis, matching economists’ and analysts’ expectations. The 3.4% Y/Y rise was the highest since October 2023. Meanwhile, increases in headline PCE on both a M/M and Y/Y basis also matched expectations, with the latter posting its highest increase since April 2023.
Despite the elevated annual readings, watchers of monetary policy reacted by marginally trimming their odds of Fed interest rate hikes this year and slightly increasing their bets that the central bank will keep rates steady. The move was driven by a belief that the May PCE report marked a peak in price pressures, as oil prices have rapidly declined this week to levels seen just before the start of the Middle East conflict, easing inflationary concerns.
Technical Levels to Watch
On a monthly chart, gold futures, after opening this month at $4,575.20, tested this month’s high at $4,577.30, and month’s low at $3,975.75, closed last Friday at $4,096.30, much below the 9 EMA ($4,353), but still below the immediate resistance at $4,098.64, where a breakdown could push the futures to test the significant support at the 20 EMA ($3,877.84).
While this month’s closing is only two trading sessions away, it looks impossible; prevailing geopolitical risks and macro factors could make it possible, as gold futures have already fallen approximately 27.11% from the record-tested peak on January 29, 2026.
Technically, gold futures tested this record peak on January 29, after a steep upward trend, which started in September 2025, and maintained a 77-degree angle amid surging FOMO (Fear of Missing Out) among the traders as the gold futures made this steep surge, after struggling in a narrow range between $3,139 – $3,510 for five months from April-August, 2025 amid surging fear of devastating impact of President Trump’s Trade Tariffs over the global economy while the Fed’s easing policy was supporting their zeal not to missed this opportunity at any cost.
On Weekly Chart, gold futures, after opening this week at $4.231.20, tested the week’s high at $4,238.10, and week’s low at $3,975.70, closed the week at $4,96.30, just below the significant resistance at the 50 EMA ($4,260.64), ensures a breakdown below the immediate support at $4,033 could push the futures to test the next support at the 100 EMA ($3,749.14), where a breakdown could push the futures to test the designated target at $3,669.12.
I conclude that only this zeal, forced by FOMO, resulted in an exacerbated inflow of money through the gold ETF, and some central banks also supported this buying spree.
But, since January 2026, President Trump’s strategy has shifted to directly overtake countries with rich sources of rare earth material and sufficient oil reserves.
As a part of his new strategy, he abducted the Venezuelan President Nicolás Maduro and his wife Cilia Flores on January 3, 2026. They were seized in a heavily coordinated predawn raid by United States special forces in Caracas and transported to New York City to face federal charges for narco-terrorism and drug trafficking.
On January 17, 2026, Trump issued a formal ultimatum on Truth Social, setting a June 1, 2026, deadline for a “complete and total” U.S. takeover of the territory. He threatened a 25% import tariff on Denmark and other European nations if a deal was not reached, but finally, he had to leave this dream due to surging opposition from the international community.
Finally, Israeli Prime Minister Netanyahu provided him an opportunity on February 28, 2026, to conduct a joint military attack on Iran, to force Iran to hand over its highly enriched nuclear reserve and energy reserve to U.S. President Donald Trump.
But both leaders found themselves stuck in a difficult situation, as Iran immediately choked the Strait of Hormuz – a strategic waterway through which one-fifty percent of energy and other essential items pass.
Moreover, Israel started devastating attack on Israel and the U.S. military bases in the Middle East, resulted in global energy crises, which are still going on when this conflict has entered in its 121st day today, despite officially has ending on June 17, after signing an MOU by officials from both sides in Switzerland, but Iran and the United States have offered conflicting accounts of key issues as negotiators work towards a final agreement within a 60-day window.
Differences remain over nuclear oversight and the implementation of any deal, underscoring the challenges facing both sides.
US Secretary of State Marco Rubio said Iran would not be allowed to charge tolls in the Strait of Hormuz under a final agreement, stressing that the strategic waterway must remain open to international shipping.
Meanwhile, Iran rejected US claims that it had agreed to allow nuclear inspectors back into the country after President Donald Trump said Tehran had accepted the “highest level” of monitoring. The conflicting statements highlight the gaps that negotiators are still trying to bridge.
On the other hand, Iranian Foreign Ministry spokesperson Esmaeil Baghaei has denied reports of a meeting with International Atomic Energy Agency (IAEA) chief Rafael Grossi and said there are currently no plans for visits or inspections by the UN nuclear watchdog.
Baghaei said Iran’s dealings with the IAEA would be governed by existing procedures, its safeguards obligations, parliamentary legislation, and decisions by the Supreme National Security Council.
I find that Washington and Tehran can complete a final agreement within the 60-day timeframe as repeatedly cited by President Donald Trump. “I think we’re talking about at least into the next calendar year,” he said, adding that he would not be surprised if both sides simply “run out the clock” by continuing negotiations and keeping the Strait of Hormuz open without reaching a final deal before the end of Trump’s presidency.
I find that the drivers behind the rally seen in 2025 are absent now, as I discussed this issue in detail in my last article Gold Eyes Key Support as Fed Rate Bets Trump Geopolitical Risks ( https://www.investing.com/analysis/gold-eyes-key-support-as-fed-rate-bets-trump-geopolitical-risks-200682857 ) last Friday.
Now, I find that renewed tension between the U.S. and Iran could stoke inflation fears, and on Monday, if gold futures start the upcoming week with a gap-down, selling could accelerate below the key support at $3,960.
Disclaimer: Readers are advised to take any position in gold at their own risk, as this analysis is based solely on observations.
